2024 (2) TMI 183 - HC - GST

Levy of penalty u/s 129(3) of the Uttar Pradesh Goods and Service Tax Act, 2017 - part A of the e-way bill was dully filled and due to some technical difficulties part B of the e-way bill could not be generated - HELD THAT - Upon consideration of the arguments made by counsel appearing on behalf the parties and upon perusal of the documents, it is clear that the department has been unable to indicate any intention of the petitioner to evade tax. Petitioner relied upon judgment of this Court in M/S Roli Enterprises Vs. State of U.P. and Others 2024 (1) TMI 813 - ALLAHABAD HIGH COURT wherein this Court had considered two judgements of the Allahabad High Court in VSL Alloys (India) Pvt. Ltd v. State of U.P. and another 2018 (5) TMI 455 - ALLAHABAD HIGH COURT and M/s Citykart Retail Private Limited through Authorized Representative vs. Commissioner Commercial Tax and Another 2022 (9) TMI 374 - ALLAHABAD HIGH COURT and held that non filling up of Part 'B' of the e- Way Bill by itself without any intention to evade tax would not lead to imposition of penalty under Section 129(3) of the UPGST Act. Thus, the judgement relied upon by the petitioner are directly on the point and, accordingly, there are no reason to defer from the same. In the present case also, the defect was of a technical nature only and without any intention to evade tax. Accordingly, the penalty imposed under Section 129(3) of the UPGST Act is unsustainable - petition allowed.

Summary

Issues involved:
The issues involved in the judgment are the imposition of penalty under Section 129(3) of the Uttar Pradesh Goods and Service Tax Act, 2017, and the validity of the orders dated April 22, 2021, and November 20, 2021.

Imposition of Penalty under Section 129(3) of UPGST Act:
The writ petitioner challenged the penalty order dated April 22, 2021, and the order of the Appellate Authority dated November 20, 2021, under Section 129(3) of the UPGST Act. The petitioner argued that although part A of the e-way bill was filled, technical difficulties prevented the generation of part B. The goods in question were custom-made with specific specifications for a particular consignee, and there were no defects or discrepancies in the consignment. The petitioner relied on a previous judgment of the Allahabad High Court which held that the non-filling of part 'B' of the e-Way Bill without any intention to evade tax would not warrant a penalty under Section 129(3) of the UPGST Act.

Contentions of the Parties:
The counsel for the respondents contended that part 'B' of the e-Way Bill was not filled as per the penalty order and the decision of the Appellate Authority. However, upon reviewing the arguments and documents presented by both parties, the court found no evidence of the petitioner intending to evade tax. The court noted that the judgments cited by the petitioner were directly relevant to the case, and there was no justification to deviate from them.

Judgment and Conclusion:
The court concluded that the technical defect in not filling part 'B' of the e-Way Bill did not indicate any intention to evade tax. Therefore, the penalty imposed under Section 129(3) of the UPGST Act was deemed unsustainable. Consequently, the court quashed and set aside the orders dated April 22, 2021, and November 20, 2021. The writ petition was allowed, and the respondents were directed to return the security to the petitioner within six weeks.