Procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances [ Section 129] - GST Ready Reckoner - GST

Procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances [ Circular No. 41/15/2018-GST dated 13 April 2018 , Circular No. 49/23/2018-GST dated 21 Jun 2018 , Circular No. 64/38/2018-GST dated 14 September 2018 , Circular No. 88/07/2019-GST dated 1 st February, 2019 ] In order to ensure uniformity in the implementation of the provisions of the CGST Act across all the field formations, the Board, in exercise of the powers conferred under section 168 (1) of the CGST Act, hereby issues the following instructions: Who authorised to interception or inspection of conveyance or goods The jurisdictional Commissioner or an officer authorised by him for this purpose shall, by an order, designate an officer/officers as the proper officer/officers to conduct interception and inspection of conveyances and goods in the jurisdictional area specified in such order. The proper officer, empowered to intercept and inspect a conveyance , may intercept any conveyance for verification of documents and/or inspection of goods. On being intercepted, the person in charge of the conveyance shall produce the documents related to the goods and the conveyance. Produce the relevant document for verification The proper officer shall verify such documents and where, prima facie, no discrepancies are found, the conveyance shall be allowed to move further. An e-way bill number may be available with the person in charge of the conveyance or in the form of a printout, sms or it may be written on an invoice. All these forms of having an e-way bill are valid. Wherever a facility exists to verify the e-way bill electronically, the same shall be so verified, either by logging on to http://mis.ewaybillgst.gov.in or the Mobile App or through SMS by sending EWBVER to the mobile number 77382 99899 (For e.g. EWBVER 120100231897). For the purposes of verification of the e-way bill, interception and inspection of the conveyance and/or goods, the proper officer under rule 138B of the CGST Rules shall be the officer who has been assigned the functions under sub-section (3) of section 68 of the CGST Act vide Circular No. 3/3/2017 GST, dated 05.07.2017 . Fails to produce the relevant documents for verification Where the person in charge of the conveyance fails to produce any prescribed document or where the proper officer intends to undertake an inspection , he shall record a statement of the person in charge of the conveyance in FORM GST MOV-01 . The proper officer shall issue an order for physical verification/inspection of the conveyance, goods and documents in FORM GST MOV-02 , requiring the person in charge of the conveyance to station the conveyance at the place mentioned in such order and allow the inspection of the goods. The proper officer shall, within twenty four hours of the aforementioned issuance of FORM GST MOV-02 , prepare a report in Part A of FORM GST EWB-03 and upload the same on the common portal. Time Limit to complete inspection and verification of proceeding The proper officer shall conclude the inspection proceedings within a period of three days from the date of issue of the order in FORM GST MOV-02, either by himself or through any other proper officer authorised in this behalf. Serve the order of extension for physical verification/inspection proceeding time to the person in charge of the conveyance:- Where circumstances warrant such time to be extended, he shall obtain a written permission in FORM GST MOV-03 from the Commissioner or an officer authorized by him, for extension of time beyond three days and a copy of the order of extension shall be served on the person in charge of the conveyance. On completion of the physical verification/inspection of the conveyance and the goods in movement:- the proper officer shall prepare a report of such physical verification in FORM GST MOV-04 and serve a copy of the said report to the person in charge of the goods and conveyance. The proper officer shall also record, on the common portal, the final report of the inspection in Part B of FORM GST EWB-03 within three days of such physical verification/inspection. Issue of order Detention or Release of the goods or conveyance Issue order of release:- Where no discrepancies are found after the inspection of the goods and conveyance, the proper officer shall issue forthwith a release order in FORM GST MOV-05 and allow the conveyance to move further. Issue of order of detention:- Where the proper officer is of the opinion that the goods and conveyance need to be detained under section 129 of the CGST Act, he shall issue an order of detention in FORM GST MOV-06 and a notice in FORM GST MOV-07 in accordance with the provisions of sub-section (3) of section 129 of the CGST Act, specifying the tax and penalty payable. The said notice shall be served on the person in charge of the conveyance. Payment of penalty determined under section 129(1) Where the owner of the goods or any person authorized by him comes forward to make the payment of tax and penalty as applicable under clause (a) of sub-section (1) of section 129 of the CGST Act. where the owner of the goods does not come forward to make the payment of tax and penalty as applicable under clause (b) of sub-section (1) of the section 129 , Issue of release order after payment of penalty The order in FORM GST MOV-09 shall be uploaded on the common portal and the demand accruing from the proceedings shall be added in the electronic liability register and the payment made shall be credited to such electronic liability register by debiting the electronic cash ledger or the electronic credit ledger of the concerned person in accordance with the provisions of section 49 of the CGST Act. The proper officer shall, after the amount of tax and penalty has been paid in accordance with the provisions of the CGST Act and the CGST Rules, release the goods and conveyance by an order in FORM GST MOV-05 . Relesed of goods or conveyance on furnishing a security along with bank guarantee Where the owner of the goods, or the person authorized by him, or any person other than the owner of the goods comes forward to get the goods and the conveyance released by furnishing a security under clause (c) of sub-section (1) of section 129 of the CGST Act, the goods and the conveyance shall be released, by an order in FORM GST MOV-05, after obtaining a bond in FORM GST MOV-08 along with a security in the form of bank guarantee equal to the amount payable under clause (a) or clause (b) of sub-section (1) of section 129 of the CGST Act. The finalization of the proceedings under section 129 of the CGST Act shall be taken up on priority by the officer concerned and the security provided may be adjusted against the demand arising from such proceedings. Consideration of any objection file by the owner of goods or owner of conveyance Where any objections are filed against the proposed amount of tax and penalty payable, the proper officer shall consider such objections and thereafter, pass a speaking order in FORM GST MOV-09, quantifying the tax and penalty payable. On payment of such tax and penalty, the goods and conveyance shall be released forthwith by an order in FORM GST MOV-05. Manner of payment of demand The order in FORM GST MOV-09 shall be uploaded on the common portal and the demand accruing from the order shall be added in the electronic liability register and, upon payment of the demand. The electronic liability register shall be credited by either debiting the electronic cash ledger or the electronic credit ledger of the concerned person in accordance with the provisions of section 49 of the CGST Act. Mandatorily initiate proceedings under section 129 In case a consignment of goods is accompanied by an invoice or any other specified document and not an e-way bill, proceedings under section 129 of the CGST Act may be initiated. Circumstance in which proceedings under section 129 not initiate In case a consignment of goods is accompanied with an invoice or any other specified document and also an e-way bill, proceedings under section 129 of the CGST Act may not be initiated, inter alia , in the following situations: Spelling mistakes in the name of the consignor or the consignee but the GSTIN, wherever applicable, is correct; Error in the pin-code but the address of the consignor and the consignee mentioned is correct, subject to the condition that the error in the PIN code should not have the effect of increasing the validity period of the e-way bill; Error in the address of the consignee to the extent that the locality and other details of the consignee are correct; Error in one or two digits of the document numbe r mentioned in the e-way bill; Error in 4 or 6 digit level of HSN where the first 2 digits of HSN are correct and the rate of tax mentioned is correct; Error in one or two digits/characters of the vehicle number . In case of the above situations, penalty to the tune of ₹ 500/- each under section 125 of the CGST Act and the respective State GST Act should be imposed (Rs.1000/- under the IGST Act) in FORM GST DRC-07 for every consignment. A record of all such consignments where proceedings under section 129 of the CGST Act have not been invoked in view of the situations listed above shall be sent by the proper officer to his controlling officer on a weekly basis . Circumstance in which confiscation of good proceeding initiate Tax and penalty not paid :- In case the proposed tax and penalty are not paid within fourteen days from the date of the issue of the order of detention in FORM GST MOV-06 , the action under section 130 of the CGST Act shall be initiated by serving a notice in FORM GST MOV-10 , proposing confiscation of the goods and conveyance and imposition of penalty. movement of goods is being effected to evade payment of tax Where the proper officer is of the opinion that such movement of goods is being effected to evade payment of tax , he may directly invoke section 130 of the CGST Act by issuing a notice proposing to confiscate the goods and conveyance in FORM GST MOV-10. In the said notice, the quantum of tax and penalty leviable under section 130 of the CGST Act read with section 122 of the CGST Act, and the fine in lieu of confiscation leviable under sub-section (2) of section 130 of the CGST Act shall be specified. Where the conveyance is used for the carriage of goods or passengers for hire, the owner of the conveyance shall also be issued a notice under the third proviso to sub-section (2) of section 130 of the CGST Act, proposing to impose a fine equal to the tax payable on the goods being transported in lieu of confiscation of the conveyance. opportunity of being heard :- No order for confiscation of goods or conveyance, or for imposition of penalty, shall be issued without giving the person an opportunity of being heard. procedure of issuing the order of confiscation of goods Passing the order:- An order of confiscation of goods shall be passed in FORM GST MOV-11 , after taking into consideration the objections filed by the person in charge of the goods (owner or his representative), and the same shall be served on the person concerned. Transfer the title of goods:- Once the order of confiscation is passed, the title of such goods shall stand transferred to the Central Government . Time limit for payment demand:- In the order of confiscation of goods a suitable time not exceeding three months shall be offered to make the payment of tax, penalty and fine imposed in lieu of confiscation and get the goods released. Manner of payment:- The order in FORM GST MOV-11 shall be uploaded on the common portal and the demand accruing from the order shall be added in the electronic liability register and, upon payment of the demand, such register shall be credited by either debiting the electronic cash ledger or the electronic credit ledger of the concerned person in accordance with the provisions of section 49 of the CGST Act. Withdrawal of order of detention:- Once an order of confiscation of goods is passed in FORM GST MOV-11, the order in FORM GST MOV-09 passed earlier with respect to the said goods shall be withdrawn. Circumstances proper officer has come power for sale or dispose of goods or conveyance In case neither the owner of the goods nor any person other than the owner of the goods comes forward to make the payment of tax, penalty and fine imposed and get the goods or conveyance released within the time specified in FORM GST MOV-11, and remit the sale proceeds to the account of the Central Government. Suitable modifications in the time allowed for the service of notice or order for auction or disposal shall be done in case of perishable and/or hazardous goods. Recovery of arrears demand in case of recovery of arrears of central tax/State tax/Union territory tax. [referred to sub-sections (3) and (4) of section 79 of the CGST Act/respective State GST Acts] Manner of payment demand in case of unregistered person Where no electronic liability ledger is available in case of an unregistered person, a temporary ID shall be created by the proper officer on the common portal and the liability shall be created therein. He shall also credit the payments made towards such demands of tax, penalty or fine and other charges by debiting the electronic cash ledger of the concerned person. Other relevant point A summary of every order in FORM GST MOV-09 and FORM GST MOV-11 shall be uploaded electronically in FORM GST-DRC-07 on the common portal. Whenever an order or proceedings under the CGST Act is passed by the proper officer, a corresponding order or proceedings shall be passed by him under the respective State or Union Territory GST Act and if applicable, under the Goods and Services Tax (Compensations to States) Act, 2017. The procedure narrated above shall be applicable mutatis mutandis for an order or proceeding under the IGST Act, 2017 .