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TMI Blog2022 (9) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... 7/2019 directing both the supplier and the recipient to appear on or before 01/07/2019 at 3.00 PM to explain as to why penalty under the above stated sections should not be imposed. It is further mentioned in the order that the validity of the c-way bill had expired on 12/05/2019, whereas, the vehicle was detected on 01/07/2019 - Moreover in the impugned order there is not even a whisper nor in the body of the order which shows that the Appellant was liable to payment of tax and penalty despite the fact that IGST had already been paid on the transaction under question. The order is totally bereft of any reasoning. Before the commencement of movement of goods the supplier had raised the tax invoice. The e-way bill was also generated prior the commencement of movement which contained the details of goods, tax invoice, as well as the buyer of the goods including his registration number under the GST Act. Once the tax invoice is issued and the e-way bill generated through online GST Portal containing all details regarding the goods the information of such transaction is available with GST authorities also, therefore, the possibility of tax evasion is very remote. The tax/penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Solan (HP) along with his team. During the course of checking the person incharge of the vehicle produced tax invoice bearing number 91072637 dated 26.06.2019 issued by M/s Hero Steel Pvt. Ltd. Ludhiana having GSTIN Number 03AACCH4638LIZK. The goods being transported were C.R. sheets (HSN Code 7211) weighing 31850 Kgs amounting Rs. 16,24,350/-(excluding GST amount) was being consigned to M/s Shree Balaji Enterprises, Vill-Latha, Baddi having GSTIN number 02ABPFS7709E1Z3. 5. While going through the documents produced by the person in-charge of the vehicle the checking team after verifying the e-way bill on the official site of the e-way bill portal found that the a-way bill bearing number 361124090042 had expired on 28.06.2019. Thereafter, the vehicle along with the goods was detained on the grounds of violation of rule 138 of HPGST/CGST read with section 20 of IGST Act 2017. Proceedings u/s 129 was initiated and detention order in Form MOV-06 issued to the person incharge to the vehicle. 6. Subsequently, notice under section 20 of IGST Act read with section 129 of HPGST/CGST Act was issued to the supplier and recipient of the goods through the person in-charge of the conveya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also read with the instructions contained issued by Central Board of Indirect Taxes and Customs contained in Circular No. 41/18/2018 GST where the due procedure regarding interception of conveyance for inspection of goods in movement. detention. release, penalty etc has been laid down. The proper officer has not uploaded the physical verification report on Form GST MOV-04 and also unloaded the MOV-09 on the common portal as required and also did not provide proper opportunity of being heard. The inspecting officer also failed to unloaded Part-A of the Form GST EWB-03 and final report in Part-B of Form GST EWB-03. c. That the impugned order passed by the proper is unsustainable as it is against law as well as against the true facts of the case. The proper officer has repeatedly observed in its order that validly of e-way bill has explained on 28.06.2019 and thus goods were under movement against invalid e-way bill. The proper officer has utterly failed to verity the validity of c-way bill which was extended up to 30.06.2019. d. That penalty order is further illegal and against the fundamental principles of law. It is against the law laid down by the apex court of the country ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory premises in time i.e. 30 th June 2019 which was Sunday and factory was closed, and goods could not be unloaded. The security Guard of the factory on duty asked the driver to come next day for unloading of goods. Before the goods could be unloaded the team of state GST official intercepted the goods and conveyance and imposed the penalty on baseless and unlawful grounds. 9. In their written reply the Respondents have submitted that the Appellant has violated the provisions of sub section (3) of section 68 and rule 138 of HPGST/CGST Rule 2017. Since the e-way bill was found expired at the time of inspection of the vehicle tax and penalty has been rightly imposed under section 129 by the Proper Officer. The Respondent has further quoted the judgement of Hon'ble Allahabad High Court in the matter of Timeexo Fasteners India (Pvt). Ltd. Vs State of UP which is not applicable in the instant case as the facts are entirely different in both the cases. XXXXXXXX 10. I have gone through the documents on record and the written submissions made by both the parties. The case was listed on 23.07.2022 for hearing on which date Sh. Somnath Ld. Advocate and Sh. 13alwant Singh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ightly imposed under section 129. 13. In order to resolve the issue. it is necessary to understand the relevant provisions of GST Acts and Rules which govern the inspection of goods in movement, detention, seizure and release of goods and conveyances in transit. 14. Section 68 of HPGST/CGST Act 2017, which, deals with the inspection of goods in movement, is reproduced as below:- (1) The Government may require the person in charge of a conveyance carrying any consignment of goods of value exceeding such amount as may be specified to carry with him such documents and such devices as may be prescribed. (2) The details of documents required to be carried under sub-section (1) shall be validated in such manner as may be prescribed. (3) Where any conveyance referred to in sub-section (1) is intercepted by the proper officer at any place, he may require the person in charge of the said conveyance to produce the documents prescribed under the said sub-section and devices for verification, and the said person shall be liable to produce the documents and devices and also allow the inspection of goods. 15 Section 129 which deals with the detention, seizure and release ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he amount of tax and penalty as provided in sub-section (1) within seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130 : Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of seven days may be reduced by the proper officer. 16. Rule 138 of HPGST/CGST Act 2017, which, deals with the information to be furnished prior to commencement of movement of goods and generation of E-Way Bill. Rule 138 (1) lays down that: - Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees- (i) in relation to supply : or (ii) for reasons other than supply: or (iii) due to inward supply from an unregistered person, shall, before commencement of such movement, furnish information relating to the said goods in Part A of RORM GST EWB-01. electronically, on the common portal. XXX XXX XXX (2) Where the goods are transported by the registered person as a consignor or the recipient of supply as the consignee, whether in his own conveyanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er has been examined. In order to clarify this issue and to ensure uniformity in the implementation of the provisions of the law across the field formations, the Board, in exercise of its powers conferred under section 168 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act ) hereby clarifies the said issue hereunder. 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 the person in charge of a conveyance carrying any consignment of goods of value exceeding ₹ 50,000/- should carry a copy of documents viz., invoice/bill of supply/delivery challan/bill of entry and a valid e-way bill in physical or electronic form for verification. In case such person does not carry the mentioned documents, there is no doubt that a contravention of the provisions of the law takes place and the provisions of section 129 and section 130 of the CGST Act are invocable. Further, it may be noted that the non-furnishing of information in Part B of FORM GST EWB-01 amounts to the e-way bill becoming not a valid document for the movement of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be sent by the proper officer to his controlling officer on a weekly basis. 7. Difficulty, if any, in implementation of this Circular may please be brought to the notice of the Board. Hindi version would follow. 19. Thus, from the above it is clear that the person in-charge of the conveyance carrying any consignment of goods of value exceeding Rs.50,000/- should carry a copy of documents v.i.z invoice/bill of supply/delivery challan/bill of entry and a valid e-way bill in physical or electronic form for verification. Non furnishing of information in Part-B of form GST EWB-01 amounts to the e-way bill becoming not a valid document for the movement of goods by road as per Explanation (2) to rule 138(3) of HPGST/CGST Rules, except in the case where the goods are transported for a distance of fifty KM within the state or Union Territory to or from the place of business of the transporter to the place of business of the consigner or the consignee. as the case may be. 20. Further. as stated in para number 5 of the circular dated 14.09.2018 mentioned at para number 15 supra in case a consignment of goods is accompanied with an invoice or any other specified document and also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty to be heard was given to him as the notice issued by the Proper Officer to appear before him was on the same date and time. when the vehicle was intercepted. The Proper Officer has failed to make out a case that there was a willful and deliberate attempt by the Appellant to evade the tax before imposing the penalty and tax. 25. The Proper Officer has failed to appreciate the fact that the objective of section 129 is to ensure that there is no evasion of tax through unaccounted movement of goods. In the instant case, the consignment was supported by tax invoice and GR which has not been disputed in the orders. As per tax invoice IGST @ 18% has been charged separately and the details in GR matches with the tax invoice. The nature and quantity of goods loaded in the vehicle is also not disputed. So far the penalty for an amount equivalent to tax is concerned those are the incidents when the tax is sought to be evaded or not deducted under section 51 etc. 26. it is a matter of record that the vehicle was checked on 01/07/2019 at 3.00PM. At the time of interception of vehicle the e-way bill produced by the person incharge of the vehicle was found expired. As per the e-way bill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... movement which contained the details of goods, tax invoice, as well as the buyer of the goods including his registration number under the GST Act. Once the tax invoice is issued and the e-way bill generated through online GST Portal containing all details regarding the goods the information of such transaction is available with GST authorities also, therefore, the possibility of tax evasion is very remote. 31. It is pertinent to discuss the Judgement of the Hon ble Supreme Court in the matter of M/s. Satyam Shivam Papers Pvt. Ltd. Vs. Asst. Commissioner (ST) and 4 others on 12 January 2022 relevant pan reproduced as under:- The consideration of the High court in the order impugned and the material placed on record leaves nothing to doubt that the attempted inference on the part of petitioner No.2, that the writ petitioner was evading tax because the e-way bill had expired a day earlier, had not only been baseless but even the intent behind the proceedings against the writ petitioner was also questionable, particularly when it was found that the goods in question, after being detained were, strangely, kept in the house of a relative of the petitioner No.2 for 16 days and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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