2018 (4) TMI 344 - HC - GST

Procedural Lapses in Goods Detention: Timely Adjudication Mandated with Manual Declaration Acceptance Under CGST/SGST Rule

HC ruled on goods detention under CGST/SGST Acts, finding procedural irregularities. Despite Form KER II website unavailability, the court directed ... Detention of goods - adjudication of detention - non-availability of electronic form disabling transporter - production of manual declaration - opportunity of hearing before adjudication - challenge to vires of statutory rules left openDetention of goods - adjudication of detention - opportunity of hearing before adjudication - non-availability of electronic form disabling transporter - production of manual declaration - Adjudication of the detention evidenced by Ext.P3 was directed to be completed within a specified time after hearing the petitioner and considering the petitioner's contentions regarding non-availability of Form KER II and production of declarations. - HELD THAT: - The Court noted the petitioner's contention that the transporter was unable to download the required Form KER II because the respondents had not enabled its generation on the website, and that a manual KER II and an online KER I on the KVATIS website had been submitted at the time of detention. Having considered the parties' submissions and the respondent's undertaking that adjudication can be completed within a week, the Court directed the 1st respondent to complete the adjudication process in connection with Ext.P3 within one week from receipt of the judgment. The Court required the 1st respondent to hear the petitioner, take note of Ext.P4 (the petitioner's reply), and specifically consider the contention that non-availability of the electronic form prevented the transporter from producing Form KER II at the time of transportation, as well as the fact of submission of a manual declaration and the online declaration in Form KER I.Direction to 1st respondent to complete adjudication relating to the detention (Ext.P3) within one week, after hearing the petitioner and considering the stated contentions and submissions.Challenge to vires of statutory rules left open - Whether the vires of the statutory rules is to be decided in the present petition was left open. - HELD THAT: - The Court expressly declined to decide the constitutional or vires challenge to the statutory rules in the present proceedings, indicating that such challenge is left open for consideration in an appropriate case. No adjudication on the vires was undertaken in this order.Challenge to the vires of the statutory rules is not decided and is left open for determination in an appropriate case.Final Conclusion: Writ petition disposed by directing the 1st respondent to conclude the adjudication of the detention (Ext.P3) within one week after hearing the petitioner and considering his contentions regarding non-availability of the electronic Form KER II and the production of manual/online declarations; the separate challenge to the vires of the statutory rules is left open. Issues: Detention of goods under CGST and SGST Acts due to lack of necessary declaration in Form KER I.In this case, the petitioner approached the Kerala High Court aggrieved by the detention of goods being transported at his instance under the Central Goods and Services Tax Act (CGST) and State Goods and Services Tax Act (SGST). The detention was based on the absence of the required declaration in Form KER I for supplies made within the State. The petitioner argued that the transporter was unable to file a declaration in Form KER II due to the unavailability of the form on the website maintained by the respondents. The petitioner contended that he should not be penalized for the infrastructure lapse on the part of the authorities hindering the transporter from obtaining the necessary forms electronically.Upon hearing both parties, the Court directed the 1st respondent to complete the adjudication process regarding the detention within a week, considering the petitioner's submissions. The Court instructed the respondent to take into account the unavailability of Form KER II on the website, the submission of the manual KER II declaration at the check post during detention, and the online submission of Form KER I on the KVATIS Website by the petitioner. The Court also left open the challenge against the statutory rules' validity for future consideration in a suitable case, as raised in the writ petition. The judgment referenced a previous Division Bench judgment from 2017 and emphasized the need for a prompt resolution of the detention issue in light of the specific circumstances presented by the petitioner.