2023 (7) TMI 97 - HC - GST

Return of goods for repairs originally meant for export - Expiry of e-way bill - the eight hour period for extension of the validity fo e-way bill had expired - the goods while being loaded into the vessel and had got damaged - HELD THAT - On perusal of the e-Way Bill it is seen that no tax was payable since the goods which were owned by the appellants were taken back to their factory at Ranchi for repairs. The goods were detained while in transit at about 8.20 a.m. on 13.09.2019. In terms of Rule 138(10) of the WBGST Rules an option is given to the assessee to extend the period of e-Way Bill and such extension should be done before eight hours and after eight hours of the expiry of its validity. Admittedly the eight hour period expired about 8.10 a.m. on 13.09.2019 and at about 8.20 a.m. the goods were intercepted and detained. The identical issue was considered by the Court in various matters and some of which being in the case of PROGRESSIVE METALS PVT. LIMITED VERSUS THE DEPUTY COMMISSIONER STATE TAX BUREAU OF INVESTIGATION SOUTH BENGAL DURGAPUR ZONE ORS. 2022 (4) TMI 1542 - CALCUTTA HIGH COURT and in KDG PROJECTS PRIVATE LIMITED ANR. VERSUS THE ASSISTANT COMMISSIONER OF STATE TAX BUREAU OF INVESTIGATION (NORTH BENGAL) RAIGANJ ZONE ORS. 2022 (9) TMI 1202 - CALCUTTA HIGH COURT and the decision in Medha Servo Drives Private Limited Anr. v. The Assistant Commissioner of State Tax Bureau of Investigation (South Bengal) Durgapur Zone Ors. 2022 (11) TMI 1185 - CALCUTTA HIGH COURT . In all these matters the Court considered the conduct of the assessee and having found that the conduct was not with the intention to evade tax granted relief to those assessees. The case on hand also would fall under the said category since there is no allegation of any evasion of tax rather it is not disputed that the goods were being transported under a cover of challan to the factory of the appellants for carrying out repairs. This Court is of the view that it is not a fit case where tax and penalty should have been levied on the appellants - Petition allowed.

Summary

Issues involved: Delay in filing appeal, Challenge against order of levying tax and penalty, Interpretation of e-Way Bill rules.

Summary:

Delay in filing appeal:
The appellants filed CAN 1 of 2023 seeking condonation of a 320-day delay in filing the appeal. The learned counsel provided an explanation for the delay, which was accepted by the Court as a bona fide reason. Consequently, the delay was condoned, and the appeal was allowed.

Challenge against order of levying tax and penalty:
In MAT 1034 of 2023, the appellants appealed against the order of the learned Single Bench, which had dismissed their writ petition challenging the levy of 100% tax and penalty by the appellate authority. The appellants had approached the writ court after a significant delay, explaining that they were waiting for the constitution of a Tribunal before filing the petition. The Court noted that the goods in question were meant for export, and despite an e-Way Bill being generated, no tax was payable as the goods were being returned to the factory for repairs. Citing previous judgments, the Court found that the appellants' actions were not to evade tax, leading to the decision that no tax or penalty should have been levied. Consequently, the appeal and writ petition were allowed, and the impugned orders were set aside and quashed.

Interpretation of e-Way Bill rules:
The case involved a detailed analysis of the e-Way Bill rules, particularly regarding the extension of the validity period. The Court considered the circumstances of the case, the purpose of the goods' transportation, and the timing of interception to determine that the appellants were not liable for tax and penalty. This interpretation was crucial in deciding the outcome of the appeal and the writ petition.