2018 (5) TMI 697 - HC - GST

Illegal Seizure of Goods under GST Act: Court Orders Release, Citing Non-Compliance with E-Way Bill

The High Court held that the seizure of goods under the GST Act was illegal and without jurisdiction due to the non-filling of 'Part B' of the e-way bill ... Seizure of goods and vehicle - GST e-way bill - Part B - Section 129(3) of the GST Act, 2017 - exception to furnishing conveyance details where goods are moved to transporter's godown for reloading within 50 km - Notification No.12 of 2018 - exception to Part B - Central Government clarification dated 31.03.2018 - release of seized goods and vehicle - seizure proceedings illegal and without jurisdictionGST e-way bill - Part B - exception to furnishing conveyance details where goods are moved to transporter's godown for reloading within 50 km - Notification No.12 of 2018 - exception to Part B - Central Government clarification dated 31.03.2018 - seizure of goods and vehicle - Section 129(3) of the GST Act, 2017 - Validity of seizure and penalty proceedings under Section 129(3) where goods were accompanied by Part A of the e-way bill but Part B was not filled because goods were brought to the transporter's godown for reloading and the initial movement was within 50 km. - HELD THAT: - The Court accepted the petitioner's case that consignors had furnished Part A of the e-way bill and charged IGST, and that vehicle details in Part B were not furnished because the goods were brought to the transporter's godown to be reloaded into the onward vehicle whose details were not then known. The Court relied upon the Government's position reflected in Notification No.12 of 2018 and the Central Government clarification dated 31.03.2018, which carve out an exception permitting transporters/registered persons not to furnish conveyance details in Part B in such circumstances (movement to transporter's godown for further transportation, within the specified distance). The Court noted that the factual matrix of the present case was identical to a recent decision of this Court in Rivigo Services Pvt. Ltd. (supra) and, applying the same reasoning, held that detention, seizure and initiation of penalty proceedings where only Part B was unfilled in the circumstances described amounted to action contrary to the Notification and the Central Government clarification. Consequently, the seizure order and consequential proceedings under Section 129(3) were held to be illegal and without jurisdiction.Seizure order dated 24.04.2018 and consequent penalty proceedings under Section 129(3) set aside; respondent directed to release the seized goods and vehicle forthwith.Final Conclusion: Writ petition allowed; seizure and penalty proceedings quashed and seized goods and vehicle ordered to be released forthwith as the seizure was held to be illegal and contrary to the Government notification and clarification permitting omission of Part B in the described circumstances. Issues:Seizure of goods under GST Act due to non-filling of 'Part B' of e-way bill.Analysis:The petitioner, a transporter, challenged the seizure of goods by the Assistant Commissioner, State Tax, Mobile Squad, based on the non-filling of 'Part B' of the e-way bill. The petitioner contended that despite consignors preparing invoices with all necessary details and downloading the e-way bill, the vehicle details for transportation from the U.P. godown were not available at the time of filling 'Part B'. The goods were detained solely for this reason, even though they were being transported within a distance of less than 50 km from New Delhi to the U.P. godown for further transportation to Assam and Nagaland. The petitioner argued that as per a Government decision and Notification no.12 of 2018, 'Part B' was not required for such intra-state transactions within 50 km, and relied on a previous court decision setting aside a similar seizure order.The High Court, considering the facts of the case and the previous court decision, held that the seizure proceedings were illegal and without jurisdiction. Citing the Government Notification and Central Government decision, the Court directed the release of the seized goods and vehicle, setting aside both the seizure order and the penalty proceedings under Section 129(3) of the GST Act. The Court emphasized that the seizure was unjustified given the circumstances of the case and the applicable regulations, aligning the judgment with the precedent set in a similar case, thereby allowing the writ petition in favor of the petitioner.