9911796707
TMI Blog2020 (2) TMI 892X X X X Extracts X X X X X X X X Extracts X X X X ..... e order dated 27-11-2018 passed by the Asst. Commissioner State Taxes & Excise (ACST&E)-cum-Proper Officer, North Enforcement Zone, Palampur vide which an additional demand of Rs. 1,18,800/- was created against the appellant under under sub-section (1) Section 129 of Goods and Service Tax Act, 2017. 3. The appellant is a private limited company and is engaged in the plantation business. The plants falling under Chapter 6 of the Customs Tariff are exempt from GST as per serial number 34 of Notification No. 02/2017-Central Tax (Rate) dated 28-06-2017. Similar notification has been issued under IGST Act and HPGST Act. As per Section 23 (1) (a) of CGST Act, 2017, any person engaged exclusively in the business of supplying goods that are wholly exempt from tax, is not required to be registered. However the appellant was not aware of the above legal provision and had taken GST Registration No. 02AABCN9078P1ZX and filling GST returns by showing exempted supplies. 4. The appellant had sent one machine named "Auto Clave" for repair to its supplier M/s. Pragati Laboratory Equipment, Ambala Cantt (Haryana) in Vehicle No. HP 37F3056 and had issued Delivery Challan No. 84 dated 29-10-2018. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -way Bill not generated for Interstate movement of Auto Clave Machine being transported for repair". The self-certified copies of GST MOV-6 and GST MOV-7 are enclosed in this regard. 7. The appellant furnished a bond in GST MOV-08 along with FDR No. 38044098038 for the amount equivalent to tax and penalty proposed. The machine along with conveyance was released on furnishing of above bond and FDR and release order in GST MOV-05 having Reference No. NEZ-03/30-10-2018 dated 01-11-2018. The self-certified copy of FDR and GST MOV-5 is enclosed in this regard. 8. The appellant filed detailed objections vide their letter dated 21-11-2018 to notice issued in GST MOV-07. In this letter, they submitted that since the appellant is engaged in the supply of exempted goods, they are not required to issue e-way bill as per Rule 138 (14) (E) of CGST Rules, 2017. They had not issued e-way bill for sending above machine for repair under this bonafide belief that they are not required to issue e-way bill being engaged in supply of exempted goods. They further submitted that activity to send goods for job work/repair does not attract GST as not covered under the definition of "supply" and as per th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant against the principles of natural justice. 12. The summary of above order no. NEZ03/92A dated 27-11-2018 has been uploaded on common portal in FORM GST DRC-07 having Reference No. ZA021118000370G dated 27-11-2018. Further, the adjudicating authority has appropriated the amount of Rs. 1,18,000/- (IGST of Rs. 59400/- and penalty of Rs. 59400/-] from FDR No. 38044098038 and got deposited this amount in Electronic cash ledger on 30-11-2018 against Reference No. SBIN90027742. This amount was got debited against liability created vide above summary of order in Electronic Cash Ledger on 03-12-2018 against Reference No. DCO212180000639. 13. The appellant vide their letter dated 07-01-2019 requested the adjudicating authority for supplying operative portion of order FORM GST MOV-09 as per proforma prescribed in Circular No. 41/15/2018-GST dated 13-04-2018, In this letter, the appellant has mentioned that Para 8 of operative part relating to "Speaking Order" and para 9 of operative part relating to "Recalculation Part" are crucial part of order and without these parts, it is not possible to know the reason for rejection of objections raised by them in their reply. The appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply.-(1) For the purposes of this Act, the expression "supply" includes- (a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business; (b) import of services for a consideration whether or not in the course or furtherance of business;1 "and" (c) the activities specified in Schedule-I, made or agreed to be made without a consideration2"." (d) The activities to be treated as supply of goods or supply of services as referred to in Schedule II (2) Notwithstanding anything contained in sub-section (1),- (a) activities or transactions specified in Schedule-III, or (b) such activities or transactions undertaken by the Central Government, the State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council, shall be treated neither as a supply of goods nor a supply of services. (3) Subject to the provisions of "sub-sections (1), (1A) and (2)" the Government may, on the recommendations of the Council, specify ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... machine was infact cleared clandestinely to evade payment of GST in the guise of sending the same on delivery challan for repair. However, it is nowhere in dispute, rather an accepted fact that the auto clove machine was sent for repair to its original supplier/manufacturer. It is rather a fact on record that the auto clove machine involved in the present case had already suffered GST as was earlier purchased on due payment of IGST of Rs. 59,400/- vide invoice no. 950 dated 12-01-2018 by the appellant and no ITC is claimed of this IGST as the appellant is engaged in the supply of exempted plants. In view of above, the impugned order is not sustainable and the same merits to be set aside. 5. The Id. Adjudicating authority has foiled to consider that detention under Section 129 of CGST/HPGST Act, 2017 read with Section 20 of IGST Act, 2017 is not sustainable as pre-requisite of intent to evade duty is missing in this case. 5.1) Chapter XIX of CGST/HPGST Act, 2017, containing Section 122 to 138, deals with offences and penalties. These sections have been made applicable to inter-state supply as per Section 20 of IGST Act, 2017. Among the said provisions, Section 122 to 128 ibid dea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imposed under sub-section (2), the owner of such goods or conveyance or the person referred to in sub-section (1), shall, in addition, be liable to any tax, penalty and charges payable in respect of such goods or conveyance. (4) 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. (5) Where any goods or conveyance are confiscated under this Act, the title of such goods or conveyance shall thereupon vest in the Government. (6) The proper officer adjudging 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." A combined reading of Section 129 (6) and 130 (1) ibid provides that detention of goods is conte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) read with Rule 138 of CGST/HPGST Act, 2017 has made applicable to inter-state transactions vide Notification No. 4/2017-Integrated Tax dated 28-06-2017] As per Section Rule 138 (14) (e) of CGST/HPGST Rules, 2017, e-way bill is not required for person dealing in goods specified in the Schedule appended to this notification as mentioned in preceding para, the appellant is not required to issue e-way bill as per above clause of Section 138 (14) ibid. Since the appellant is engaged in supply of only exempted goods under above notification, they were under the impression that they are not required to issue e-way bill in any case. This is the reason that they had not issued e-way bill for the machinery sent for repair. This lapse merits to be condoned considering the same as of procedural nature when no revenue is involved in the transaction as discussed in the succeeding paras. Thus, the impugned order passed without considering the above bonafide belief & un-intentional mistake on part of appellant is not sustainable and the some merits to be set aside. 7) The Ld. Adjudicating authority vide their letter No. NEZ/Palampur/595 dated 26-11-2018 has taken the plea that e-way bill is req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued to the tax payer in form GST-MOV-07 to show cause within 7 days from the receipt of notice, but the tax payer failed to do so within stipulated time period. It is clear from interpretation of provision of the Act that notice issued GST-MOV-07 is sustainable and dealer has been afforded enough opportunity of being heard. Pt. No. 3: Order of demand of tax and penalty in form MOV-09 issued to the tax payer on 27-1-2018 and duly received by the tax payer on same date i.e. 27-11-2018. Pt. No. 4: In this para, it is submitted that E-way bill is required for movement of goods not only for the reason "supply:", but also required to be generated for the reasons other than supply as stated in rule 138 (10 (II) of the E-way bill rules. Pt. No. 4.1: In this para, it is submitted that the tax/penalty under section 129 (3) is imposed as per Act ibid and rules framed there under. Pt. No. 4.2: In this pare, it is submitted that activity to send goods for job work or repair work is considered as other than supply (Read rule 138 (i) (ii), it requires to generate E-way Bill which the dealer failed and so section 129 (1) (A) attracted and thus tax and penalty was imposed as per HPGST Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are wholly exempt from tax under GST. He further submitted that the ld. Adjudicating authority has failed to consider that the appellant was under bonafide belief that e-way bill is not required as they are engaged in the supply of exempted goods i.e. plants as per Rule 138 (14) (E) of CGST/HPGST Rules, 2017. Th0 were under the impression that they are not required to issue e-way bill in any case. This is the reason that they had not issued e-way bill for the machinery sent for repair. He also submitted that their transaction doesn't satisfy the definition of "supply" under section 7 of HPGST/CGST Act, 2017 as the goods were not meant for sale. 18. The Id. respondent in response argued that as per Rule 138 (1) of CGST/HPGST Rules, 2017, every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees in relation to a supply; or for reasons other than supply; or due to inward supply from an unregistered person, is required to generate e way bill before the commencement of such movement. 19. The petitioner later accepted the fact that e way bill is required in cases other than supply and pleaded that since there is no tax implication in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
