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TMI Blog2019 (4) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 - As per clause (k), in case the proposed tax and penalty are not paid within seven days from the date of the issue of the order of detention in Form GST MOV-06, action under section 130 of the CGST Act shall be initiated, proposing confiscation of the goods and conveyance and imposition of penalty. In the present set of facts, it is not in dispute that the notice under Section 129(1)(b) of CGST/KGST Act, 2017 was issued by the respondent on 2.01.2019, to which objections were filed by the petitioners. In such circumstances, it was incumbent on the part of the respondent to consider the said objections and pass a speaking order quantifying the tax and penalty and thereafter to release the goods subject to payment of tax and penalty or to confiscate the goods. However, the respondent considering the objections filed by the petitioners proceeded to pass the impugned order of confisc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 kgs to petitioner No.1. The said transaction suffered IGST. Respondent intercepted the vehicle carrying the said goods on 4.12.2018 at 10.30 p.m. at Chennagiri near Tarala Balu Circle. Despite the driver, in-charge of the vehicle produced the tax invoices and e-way bill to the respondent, the respondent suspected the genuineness of the said documents and initiated an enquiry. It is the grievance of the petitioners that the respondent came to an unilateral presumption that the consignor is indulging in issuing tax invoices fraudulently without causing any movement of goods in violation of Section 122(1) of KGST Act which was unwarranted. Respondent passed a confiscation order after issuing the penalty notice without considering the objections filed by the petitioners and there being no penalty order passed. Hence, petitioners seek for setting aside the order impugned being ex-facie illegal. 4. Learned HCGP appearing for the revenue would submit that the contents of the impugned order indicates the quantification of the penalty and fine payable under Section 130(1) or 130(2) of CGST Act. It is a bonafide mistake committed in quoting a wrong provision of law. Indeed the said pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty; (c) upon furnishing a security equivalent to the amount payable under clause (a) or clause (b) in such form and manner as may be prescribed: Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods. (2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for detention and seizure of goods and conveyances. (3) The proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c). (4) No tax, interest or penalty shall be determined under sub-section (3) without giving the person concerned an opportunity of being heard. (5) On payment of amount referred in subsection (1), all proceedings in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gnor or the consignee should be deemed to be the owner. In the Circular No.41/15/2018-GST dated 13.4.2018 issued by the Government of India, procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances is prescribed, wherein at clause (g) it is observed that in cases where no discrepancies are found after 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. 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 notice shall be served on the person in charge of the conveyance. In terms of Clause (h), 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, or w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law in passing the order impugned but the procedure prescribed is disturbed. It is well settled law that unless the tax and penalty are quantified, no confiscation order could be passed. It is necessary to provide an opportunity to the owner of the goods or person incharge of the goods vehicle to make payment of tax and penalty subsequent to the objections filed, if any. Without providing such an opportunity, proceeding to pass confiscation order directly would not be construed as any mistake, defect or omission to come within the ambit of Section 160 of the CGST Act. It is a fundamental flaw which goes to the root of the matter and the said lacuna cannot be cured by referring to Section 160 of the CGST Act. More particularly, when the Circular instructions issued by Government of India clarifies the procedure to be followed by the proper officer while dealing with these matters. Passing of the penalty order being sine qua non in the proceedings initiated by the respondent under Section 129(1)(b) of the Act and the same being missing, the confiscation order impugned herein cannot be held to be justifiable. 12. However, considering the totality of circumstances of the case and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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