2018 (1) TMI 815 - HC - GST

Government notification adequately addresses IGST CGST implementation issues regarding flying squad monitoring and E-Way Bills

The Madras HC closed a writ petition challenging improper implementation of IGST and CGST Acts regarding flying squad monitoring of goods movement and ... Verification of Documents and Conveyances - interception to verify the e-way bill - installation of Radio Frequency Identification Device readers - physical verification of conveyances - inspection, search, seizure and related powersVerification of Documents and Conveyances - interception to verify the e-way bill - installation of Radio Frequency Identification Device readers - physical verification of conveyances - inspection, search, seizure and related powers - Compliance with the petitioner's prayers (a)-(d) concerning implementation of e-way bills and augmentation of flying squads to monitor movement of goods. - HELD THAT: - The Court considered the counter-affidavit filed by the second respondent and Notification No. 27/2017-Central Tax, dated 30.08.2017. The Court extracted and relied upon Rule 138B of the Central Goods and Services Tax Rules, 2017, which authorises the Commissioner or his delegate to direct proper officers to intercept conveyances to verify e-way bills or e-way bill numbers, mandates installation of RFID readers at verification points where movement of goods is to be verified, and provides for physical verification of conveyances by authorised officers (with a proviso for verification on receipt of specific information of tax evasion). In view of these statutory provisions and the stand taken in the counter-affidavit, the Court concluded that the reliefs sought in prayers (a)-(d), including the request for increasing flying squads at State, District and Zonal levels to monitor movement of goods and e-way bills, have been addressed by the notified scheme and Rule 138B; consequently, no further directions were required. [Paras 4, 7, 9, 11]The petitioner's prayers (a)-(d) are considered to have been complied with by the measures reflected in the counter-affidavit and Rule 138B; no further orders are necessary and the writ petition is closed with no costs.Final Conclusion: The Court held that the statutory scheme and the measures disclosed in the counter-affidavit and Notification No. 27/2017-Central Tax (notably Rule 138B concerning interception, RFID deployment and physical verification) adequately address the petitioner's grievances regarding e-way bills and monitoring of movement of goods; the writ petition is closed and dismissed with no costs. Issues:Improper implementation of Integrated Goods and Services Tax Act and Central Goods and Services Tax Act.Analysis:The petitioner was aggrieved by the improper implementation of the Integrated Goods and Services Tax Act and the Central Goods and Services Tax Act, passed in 2017. The writ petition was entertained on 28.08.2017, and the learned Additional Government Pleader accepted notice on behalf of the fifth respondent and undertook to file a counter-affidavit. When the matter was listed on 12.12.2017, the Commissioner, Central GST and Central Excise, Madurai, filed a counter-affidavit stating that the petitioner's prayers (a) to (d) had been complied with, except for prayer (d) regarding increasing the flying squad to monitor the movement of goods and E-Way Bills. The petitioner informed the Court that prayer (d) had not been properly addressed by the Union of India. The Court directed the petitioner to review Notification No. 27/2017-Central Tax, New Delhi, dated 30.08.2017 and submit a response, listing the matter for 03.01.2018.The petitioner argued that the notification addressed prayer (d) as well, and requested the concerned respondent to comply with the terms of the notification. The Standing Counsel for the second respondent referred to Section 138B of the Central Goods and Services Tax Rules, 2017, which authorizes the interception of conveyances to verify e-way bills for the movement of goods. The Court carefully considered the submissions and the materials on record.Section 138B of the Central Goods and Services Tax Rules, 2017, empowers the Commissioner to intercept conveyances to verify e-way bills for both inter-State and intra-State movement of goods. The physical verification of conveyances can be carried out by the proper officer as authorized by the Commissioner. The Court's previous order dated 12.12.2017 noted that the prayers (a) to (d) had been addressed by the second respondent, except for prayer (d) regarding the flying squad. The Court found that the provision under Section 138B adequately protected the revenue's interest, and no further orders were deemed necessary in the writ petition. Consequently, the writ petition was closed, and the order passed on 12.12.2017 formed a part of the final order, with no costs imposed.