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2023 (10) TMI 863 - HC - GSTPenalty order u/s 129(3) - Stock transfer - non-filling up of Part B of e-way bill - Bonafide intention - HELD THAT - The specific point was raised before the authority also, but the authority failed to consider the same. Since the respondents have utterly failed to show any intention to evade payment of tax in the present case, the impugned order cannot be justified. Since the goods in question were stock transfer from one Unit to another within the State of Uttar Pradesh (Agra to Mathura) and in absence of any provision being pointed out by the learned ACSC or any authority below that the goods (stock transfer) in transit were liable for payment of tax, no evasion of tax could be attributed to the goods in question. Once there was no intention to evade payment of tax, the entire proceedings initiated against the petitioner are vitiated and are liable to be set aside. The order passed by the Additional Commissioner, Grade 2 (Appeal), State Tax, Mathura as well as the order passed by the Assistant Commissioner, State Tax, Mobile Squad, Unit 4, Mathura cannot be sustained in law and the same are hereby quashed - Petition allowed.
Issues involved:
The issues involved in the judgment are the constitution of GST Tribunal in Uttar Pradesh and the challenge against penalty orders under section 129(3) of the UPGST Act. Issue 1: Constitution of GST Tribunal in Uttar Pradesh The petitioner filed a writ petition challenging penalty orders due to the absence of a GST Tribunal in Uttar Pradesh. The Court entertained the petition as no GST Tribunal had been constituted in the state as per the central government's notification. Issue 2: Challenge against Penalty Orders under Section 129(3) of the UPGST Act The petitioner, a registered company dealing in production, faced penalty orders for a transportation incident where part 'B' of the e-way bill was not filled. The petitioner argued that it was a transporter's mistake, promptly rectified. The authorities upheld the penalty despite no intent to evade tax and the goods being stock transferred within the state. The Court observed that the goods were stock transferred from one unit to another within the state, accompanied by proper documents except for the incomplete part 'B' of the e-way bill. The petitioner rectified the discrepancy before the seizure order was passed, showing no intent to evade tax. The Court highlighted the lack of provision for taxing stock transfers within the state. The Court referred to previous judgments emphasizing the necessity of intent to evade tax for penalty proceedings under the CGST Act. It held that since there was no intention to evade tax in the present case, the penalty orders were unjustified and quashed them. The Court allowed the writ petition, ordering the refund of any fines or penalties deposited by the petitioner. The respondents were directed to comply with the refund within a month, with interest payable if delayed. The authorities were permitted to recover interest from the responsible officer. The matter was listed for review after two months for the filing of an affidavit confirming the refund compliance.
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