2023 (2) TMI 587 - HC - GST

Detention of goods alongwith conveyance - allegation is that E-invoice submitted by the petitioner is a manipulated one - HELD THAT - As seen from the impugned order, reasons have been given for rejecting the petitioner's contention in its reply dated 02.02.2023 sent by them to the show cause notice issued by the respondent. When reasons have been given, that too when the respondent has referred to Circular No.17/22-G.S.T., dated 01.08.2022, which according to them makes it mandatory for submission of E-invoice from 1st October 2022, when the aggregate turnover of the businesses exceeds Rs.10 crores in any financial year from 2017-18 to 2021-2022, this Court cannot entertain this writ petition as principles of natural justice have not been violated by the respondent as only after giving them time to submit a reply and that too after the petitioner has submitted its reply, which is also considered by the respondent, the impugned order has been passed. The only limited relief that can be granted to the petitioner is to permit them to file a statutory appeal, if aggrieved by the impugned order before the statutory Appellate Authority as per the provisions of Section 107 of G.S.T. Act, 2017 and a direction is issued to the statutory Appellate Authority as and when an appeal is filed by the petitioner to consider the petitioner's application seeking for provisional release under Section 129(1) of the G.S.T Act, 2017, after giving due consideration to the fact that the petitioner is willing to deposit the penalty amount as stipulated under the impugned order under protest for getting provisional release of the goods and the conveyance and take a decision, within a short time to prevent any further deterioration of the goods and conveyance. This writ petition is disposed of.

Summary

Issues:
Challenge to order under Section 129 of GST Act, 2017 - Penalty imposition - Detention of goods and conveyance - Submission of reply to show cause notice - Rejection of reply based on E-invoice discrepancy - Writ petition seeking release of detained goods - Statutory appellate remedy under Section 107 of GST Act, 2017 - Consideration of provisional release on depositing penalty amount - Directions for filing statutory appeal and seeking provisional release.

Analysis:
The writ petition challenges an order passed under Section 129 of the Goods and Services Tax Act, 2017, imposing a penalty on the petitioner for discrepancies related to E-invoicing. The respondent detained the petitioner's vehicle and goods due to the absence of an E-invoice during transportation. The petitioner submitted a reply explaining the situation, citing technical issues in generating E-invoices for a scrap sale. However, the respondent rejected the reply, deeming the submitted E-invoice as manipulated.

The court noted that the petitioner had a statutory appellate remedy available under Section 107 of the GST Act, 2017 but opted for a writ petition due to the detention's potential heavy loss. The petitioner expressed willingness to deposit the penalty amount for provisional release of goods and conveyance. However, the court found that principles of natural justice were not violated as the respondent provided reasons for rejecting the reply and considered the Circular mandating E-invoicing.

The court directed the petitioner to file a statutory appeal and apply for provisional release before the Appellate Authority. It instructed the Appellate Authority to decide on the appeal within two weeks and consider the application for provisional release promptly. Additionally, the court directed the respondent to entertain any application for provisional release under Section 129(6) of the GST Act, 2017, on payment of a specified penalty amount within a week of filing.

In conclusion, the writ petition was disposed of with directions for statutory appeal filing, seeking provisional release, and consideration of the penalty amount for release of detained goods and conveyance. No costs were awarded, and the connected miscellaneous petition was closed.