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TMI Blog2019 (5) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 129 (4) of the Act calling upon them to appear for adjudication, they have not responded to the same. The petitioners are thus directed to appear before the first respondent on 06.03.2019 at the first instance, for commencement of proceedings for adjudication. The question of whether the movement of the consignments sans valid E-way bills constitutes a substantive error or a mere technical breach shall be considered by the Assessing Officer, having regard to the provisions of Sections 122, 125 and 126 of the Act as well all relevant Instructions and Circulars issued by the Board. Let the officer also bear in mind that E-way bills, though stale, had, in fact, accompanied the consignments. The assessees/petitioners have offered explanations in regard to the circumstances that caused the documents to expire and such explanations will be taken into consideration by the officer in determining the quantum of penalty to be levied. Consignments in the case of Caterpillar - HELD THAT:- Their immediate release is ordered, the interests of the Department must remain protected. The penalty is quantified, for the moment, and solely for the purposes of this order, 100% of the tax. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Heard Mr.R.Raghavan Ramabadran, learned counsel appearing for Caterpillar, Mr.B.Raveendran, learned counsel appearing for the Transporter and Mr.Mohamad Shafiq, learned Central Government Standing Counsel, appearing for the respondents, in all the writ petitions. 5. Caterpillar has, admittedly, transported consignments of 'Off Highway trucks' that are zero rated in terms of Section 18 of the IGST, without valid and necessary E-way bills accompanying the same. The case of the petitioner is that along with the Tax Invoice, an E-way bill dated 08.02.2019 was originally generated. However, the consignments required special police permission for their movement between the hours of 11 p m and 5 a m. Though sought, the police permission was delayed, by which time the E-way bill, the validity of which is four (4) hours only, had expired. It is explained that the police permission had not been received in time on account of the intervening weekend. The permission was received on 11.02.2019 and the goods moved thereafter, admittedly, unaccompanied by valid E-way bills. The consignments were intercepted on 11.02.2019 in the course of movement to the Port for shipping when it was found b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 20 Km or part thereof thereafter One additional day in case of Over dimensional cargo. Provided that the Commissioner may, on the recommendations of the Council, by notification, extend the validity period of an e-way bill for certain categories of goods as may be specified therein: Provided further that where, under circumstances of an exceptional nature, including trans-shipment, the goods cannot be transported within the validity period of the e-way bill, the transporter may extend the validity period after updating the details of Part B of Form GST EWB-01, if required. Explanation 1._ for the purposes of this rule, the 'relevant date' shall mean the date on which the e-way bill has been generated and the period of validity shall be counted from the date at which the e-way bill has been generated and each day shall be counted as the period expiring at midnight of the day immediately following the date of generation of eway bill.' 9. Notwithstanding the above, neither of the petitioners' have, admittedly, taken the necessary measures or precautions to ensure extension of validity of the E-way bill or generation of an alternate valid one, but have moved the consignments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is no liability to tax despite which taxes have been remitted, as a result that it is entitled to a refund. This is a matter of adjudication and I hence refrain from delving deeper upon this aspect. Suffice it to state, as a matter of fact, that, in both cases, taxes have admittedly been remitted, albeit under protest. What remains is the penalty. Section 129 (1) (c) of the Act provides for furnishing of security equivalent to the amount payable under Clauses (a) or (b) in such form and manner as may be prescribed. This constitutes, in my view, prima facie protection of the interests of the Department, pending adjudication proceedings for determination of the tax and penalty. 12. The quantum of taxes, already remitted, will be eventually determined in assessment. At this juncture, I am thus, only concerned with the levy of penalty and the security to be furnished to the Department in this regard. 13. In this regard, my attention is drawn to the provisions of Section 130 of the Act, dealing with the confiscation of goods or conveyances and levy of penalty, extracted below:- '130. Confiscation of goods or conveyances and levy of penalty (1) Notwithstanding anything con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judging confiscation shall take and hold possession of the things confiscated and every officer of Police, on the requisition of such proper officer, shall assist him in taking and holding such possession. (7) The proper officer may, after satisfying himself that the confiscated goods or conveyance are not required in any other proceedings under this Act and after giving reasonable time not exceeding three months to pay fine in lieu of confiscation, dispose of such goods or conveyance and deposit the sale proceeds thereof with the Government." 14. According to the respondents in all writ petitions, the confiscation of the goods is perfectly in order as the petitioners have, admittedly, transported the consignments without valid E-way bills, thus violating clause (iv) of Section 130(1) above being, a contravention of the Act/Rules with the intent to evade tax. There is, no doubt, a violation in the present case, but one that has no revenue (tax) implications, seeing as the petitioners have remitted the taxes upon the consignments in full, under protest and pending adjudication. The question of determination of tax, if any, is, of course, left open to the authorities, to be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicable law, regulation or procedure under which the amount of penalty for the breach has been specified. (5) When a person voluntarily discloses to an officer under this Act the circumstances of a breach of the tax law, regulation or procedural requirement prior to the discovery of the breach by the officer under this Act, the proper officer may consider this fact as a mitigating factor when quantifying a penalty for that person. (6) The provisions of this section shall not apply in such cases where the penalty specified under this Act is either a fixed sum or expressed as a fixed percentage.' 18. The Central Board of Indirect Taxes and Customs, New Delhi, has issued a Circular in F.No.CBEC/20/16/03/2017-GST, dated 14.09.2018, in regard to the procedure to be followed in the 'Interception of conveyances for inspection of goods in movement and detention, release and confiscation of such goods and conveyances'. 19. My attention is drawn to paragraphs 3, 4, 5 and 6 of the said Circular, extracted below:- '.... 3. Section 68 of the CGST Act read with rule 138A of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as 'the CGST Rules') requires that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber mentioned in the e-way bill; e) 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; f) Error in one or two digits/characters of the vehicle number. 6. 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 (₹ 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 in paragraph 5 above shall be sent by the proper officer to his controlling officer on a weekly basis......'he questions to be determined in these cases relate to the release of consignment and the quantum of penalty, if any, to be levied at this stage, and pending adjudication. 20. As far as the determination of penalty is concerned, it is the Assessing Officer / State Tax Officer who is the competent and proper person for such determination/quantification. However, a holistic reading of the statutory provisions and the Circular noted above, indicates to me that the Department does ..... 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