9911796707
TMI Blog2023 (10) TMI 635X X X X Extracts X X X X X X X X Extracts X X X X ..... re transported from West Bengal to Kanpur through railway in the wagon against invoices and other documents required under the Act. The wagon was unloaded and taken into custody by the petitioner for further transportation of good to Bazpur. For that purpose two vehicles were deployed bearing registration nos. HP 939081 and UP 25 BT 6528 ("the vehicles"). Accordingly, e- way bill was also generated and goods were moved towards its destination on 04.06.2023. When the vehicles were intercepted by the respondent no. 3, it was found that the vehicles were not carrying the delivery challans as required under Rule 55 (5) (b) of the Central/State Goods and Services Rules, 2017("the 2017 Rules"). After completing the procedure as required under the Act and Rules, by the impugned order, separate penalty has been imposed with regard to the each of the vehicles engaged in transportation. In these petitions, those two orders dated 09.06.2023 have been challenged. The petitioner also seeks refund of the amount which was deposited on 10.06.2023 pursuant to the impugned orders dated 09.06.2023. 4. It is the case of the petitioner that the imposed penalty is illegal and it has been passed without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sproportionate; it was an error which was rectifiable. Learned counsel would also raise the following points in his submission:- (i) According to the principle of interpretation, a statutory provision should not be read in the manner that it may tend to make any other provision of the statute as redundant; the provision of the statute should be read so as to give life to each of the provisions contained in the statute; there should be harmonious interpretation of the statutory provisions. (ii) Essentially, the taxing statute ensures that there is no leakage in the tax; it avoids loss to exchequer, as also it protects the interest of honest tax payer, and also takes care of those, who defaults in the payment of tax. Referring to Circular No. 64/38/2018/GST of the Government of India, it is argued that in case of non-compliance of the provisions with regard to generation of e-way bill, necessarily the provision of Section 129 of the Act may be invoked, but not in case of minor infraction. (iii) In the instant case, there is no allegation or chance of evasion of tax. GST authorities were told of the transactions, firstly, when the goods were transported from Kolkata to Kanpur th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fraudulent intent and negligence". 14. In the case of Smart Roofing Pvt. Ltd. (supra), the proceeding under Section 129 of the Act were challenged. It was the case of the petitioner in that case that he had no intention to evade tax as he had already generated the e-way bill by declaring the consignee etc. The Hon'ble Madras High Court held that "no doubt, the authorities acting under the Act were justified in detaining the good inasmuch as there is a wrong declaration in the E-way bill. However, the facts indicate that the consignor and the consignee are one and the same entity, namely, Head Office and the Branch Office." The Hon'ble Court further observed that "in that case, there is only a technical breach committed by the petitioner and there is no intention to evade tax accordingly." The principles of law, as laid down in the case of Smart Roofing Pvt. Ltd. (supra) were followed in the case of Algae Labs Private Limited (supra). 15. In the case of Varun Beverages (supra), there was an error in the vehicle registration number. The proceedings under Section 129 of the Act were initiated, which were challenged. The Hon'ble Court held that "as there is no dispute to the fact tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 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." 19. Section 122 of the Act is in Chapter XIX of the Act, which deals with offences and penalty. It reads as follows:- "122. Penalty for certain offences.- (1) Where a taxable person who-- (i) supplies any goods or services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply; (ii) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act or the rules made thereunder; ......................................................................... ......................................................................... ......................................................................... ......................................................................... (xiv) transports any taxable goods without the cover of documents as may be specified in this behalf; ................................................. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. (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." 21. Section 129 of the Act provides for procedure in case of detention, seizure and release of goods and conveyances in transit. It reads as follows:- "129. Detention, seizure and release of goods and conveyances in transit.- (1) Notwithstanding anything contained in this Act, where any person transports any goods or stores any goods while they are in transit in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the said goods and documents relating to such goods and conveyance shall be liable to detention or seizure and after detention or seizure, shall be released,-- (a) on payment of the applicable tax and penalty equal to one hundred per cent. of the tax payable on such goods and, in case of exempted goods, on payment of an amount equal to two per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods comes forward for payment of such tax and penalty; (b) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ................................." 23. There is another Section which deals with violation of the Rules. It is Section 164 of the Act, which reads as follows:- "164. Power of Government to make rules.- (1) The Government may, on the recommendations of the Council, by notification, make rules for carrying out the provisions of this Act. (2) Without prejudice to the generality of the provisions of sub-section (1), the Government may make rules for all or any of the matters which by this Act are required to be, or may be, prescribed or in respect of which provisions are to be or may be made by rules. (3) The power to make rules conferred by this section shall include the power to give retrospective effect to the rules or any of them from a date not earlier than the date on which the provisions of this Act come into force. (4) Any rules made under sub-section (1) or sub-section (2) may provide that a contravention thereof shall be liable to a penalty not exceeding ten thousand rupees." 24. Reference has also been made to Rules 55 and 138 of the 2017 Rules. Rule 55 Sub-Rule (3) and Rule 55 Sub-rule (5) are as follows:- "55. Transportation of goods without issue of invoice. - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvoice may be replaced by bill of supply or the delivery challan, as the case may be. This proposition, by mere reading of Rule 138 A sub-Rule (1) (a), may not be doubted. 28. Reference has also been made to Rule 55 sub-Rule (3) which has already been quoted hereinabove. According to which, when the goods are transported on the delivery challan in lieu of invoice, it needs to be declared as specified in Rule 138. This has been referred to indicate that both invoice and delivery challan may be interchangeable. It is also argued that there remains no other information with regard to the goods, which may not be found in any of these two documents. 29. During the course of hearing, the Court wanted to know from the learned State counsel as to what additional information the delivery challan may have? 30. Learned State counsel would submit that the delivery challan may be accompanied separately by each of the vehicle. It has not been indicated that the delivery challan contains any additional information. 31. Admittedly, the petitioner had generated e-way bills pertaining to both the vehicles. The vehicles were carrying invoices, e-way bills and bilty. It is not a case of tax evasio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers, (2020) 6 SCC 411, the Hon'ble Supreme Court on this aspect observed as hereunder:- "33. It is a settled principle of law that where two provisions of an enactment appear to conflict, courts must adopt an interpretation which harmonises, to the best extent possible, both provisions. Justice G.P. Singh in his seminal work Principles of Statutory Interpretation states: "To harmonise is not to destroy. A familiar approach in all such cases is to find out which of the two apparently conflicting provisions is more general and which is more specific and to construe the more general one as to exclude the more specific... The principle is expressed in the maxims generalia specialibus non derogant and generalibus specialia." Similarly, Craies in Statute Law states: "The rule is, that whenever there is a particular enactment and a general enactment in the same statute, and the latter, taken in its most comprehensive sense, would overrule the former, the particular enactment must be operative, and the general enactment must be taken to affect only the other parts of the statute to which it may properly apply." Where two provisions conflict, courts may enquire which of the two pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a), "the vehicle could have been released on payment of applicable tax", which this Court had already discussed. It makes it abundantly clear that initially when Section 129 of the Act was enacted, the legislature had considered that there was some tax element, which was to be addressed before the release of the vehicle. Section 122 of the Act, on the other hand, is simpliciter. Section 122 (xiv) of the Act makes one liable to some penalty if a person transports any taxable goods without the cover of the documents as may be specified in this behalf. It has no tax element. 39. A bare reading of the Section 122 of the Act makes it abundantly clear that mere non-production of document is punishable herein. 40. The arguments made on behalf of the State does not merit acceptance that this provision under Section 122 of the Act would not apply, when the vehicle is intercepted. 41. Undoubtedly, Section 129 of the Act begins with non obstante clause. Detention, search and seizure may be done. But what followed after such detention. Every detention may not invariably proceed under Section 129 of the Act. This has further been confirmed by virtue of the Circular 94 issued by Government o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
