E-Way bill enforcement must follow the operative Rule 138 regime, while State GST officers may act in inter-State matters if authorised.

When the substituted Rule 138 e-way bill regime came into force on 01.02.2018, seizure, detention, show cause and consequential orders based on earlier notification- and circular-driven procedures became unsustainable if they relied on superseded requirements. In the connected writs, the Court set aside such action where authorities proceeded under the obsolete framework. In the inter-State movement petition, however, the Court held that State GST officers could act where the statutory framework authorised them and the Central and State GST provisions were pari materia; the plea that the State requirements were ultra vires failed, and the petitioner was left to pursue the statutory remedy.

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Issues: (i) Whether seizure orders, detention notices and consequential orders passed for alleged non-carrying or invalid carrying of e-way bills were sustainable in law in view of the amendments and substitutions made to Rule 138 and the connected notifications and circulars. (ii) Whether, in the case of inter-State movement of goods, the U.P. authorities lacked jurisdiction or the State e-way bill requirements were ultra vires.

Issue (i): Whether seizure orders, detention notices and consequential orders passed for alleged non-carrying or invalid carrying of e-way bills were sustainable in law in view of the amendments and substitutions made to Rule 138 and the connected notifications and circulars.

Analysis: The governing e-way bill regime underwent rapid statutory change. The Court found that the earlier notification and circular-based procedure stood displaced once the substituted Rule 138, made effective from 01.02.2018, came into force. The impugned orders in the connected matters, except one, proceeded on the basis of the earlier regime and required compliance with forms and procedures that were no longer operative. The authorities therefore acted under a mistaken understanding of the applicable law.

Conclusion: The seizure orders, show cause notices and consequential orders in the connected matters were unsustainable and were set aside, being in favour of the assessees.

Issue (ii): Whether, in the case of inter-State movement of goods, the U.P. authorities lacked jurisdiction or the State e-way bill requirements were ultra vires.

Analysis: The Court held that the GST constitutional and statutory framework enables State officers to act as proper officers in the manner provided by the governing enactments, and that the relevant provisions under the Central and State GST laws were pari materia. In the petition concerning inter-State movement, the Court rejected the contention that the State provisions were ultra vires merely because the movement was inter-State. It further held that mere reference to a wrong provision would not invalidate action where power otherwise existed, and relegated the petitioner to statutory remedy.

Conclusion: The challenge to the State's jurisdiction and the plea of ultra vires failed in that petition, and the petition was dismissed with liberty to pursue the statutory remedy.

Final Conclusion: The common judgment granted relief in the bulk of the writ petitions by invalidating seizure-based action taken under an incorrect understanding of the operative e-way bill regime, while upholding the impugned action in the one petition where the State notification and enforcement framework was held not to be ultra vires on the facts presented.

Ratio Decidendi: Where the applicable e-way bill rule has been validly substituted and brought into force, enforcement action must be tested against that operative regime and not against earlier, superseded notifications or circulars; State GST officers may also act in inter-State matters where the statutory framework authorises them and the provisions are pari materia.

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