Court quashes detention of truck under GST Act Section 129, citing unjustified grounds.

The court found the detention of the truck with goods under Section 129 of the GST Acts unjustified, as it was based on extraneous grounds not required by the statute. The court quashed the orders of detention and notices issued under Section 129 of the GST Acts, allowing the petitions.

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Issues Involved:
1. Legality of detention/seizure under Section 129 of the GST Acts.
2. Compliance with procedural requirements under the GST Acts.
3. Validity of grounds for detention (photocopy of transport receipt and handwritten details).
4. Relevance of subsequent grounds raised in the affidavit-in-reply.
5. Applicability of Circular No. 64/38/2018-GST dated 14.9.2018.
6. Requirement of GST registration for specific commodities.
7. Legal implications of driver's statements regarding the destination of goods.

Detailed Analysis:

1. Legality of Detention/Seizure under Section 129 of the GST Acts:
The petitioner argued that the detention/seizure of the truck with goods under Section 129 of the GST Acts was "wholly without jurisdiction, arbitrary and illegal." The petitioner had complied with all procedural requirements, including the preparation of a tax invoice, generation of an e-way bill, and possession of a transport receipt. The court noted that the truck was detained on the grounds that the transport receipt was a photocopy and had handwritten details, which were not stipulated as mandatory under the GST Acts.

2. Compliance with Procedural Requirements under the GST Acts:
The petitioner had complied with the procedural requirements for the movement of goods under the GST Acts, including the preparation of the tax invoice, generation of the e-way bill, and possession of the transport receipt. The court found that the petitioner had adhered to the necessary procedures and that the detention was based on extraneous grounds not required by the statute.

3. Validity of Grounds for Detention (Photocopy of Transport Receipt and Handwritten Details):
The court found that the detention of the truck on the grounds that the transport receipt was a photocopy and had handwritten details was not justified. The GST Acts did not prescribe any specific format for the transport receipt, and the petitioner had explained that it was common practice to send scanned copies of the transport receipt, which were then filled and signed by the authorized representative of the transporter. The court held that there was no breach of the GST Acts in this regard.

4. Relevance of Subsequent Grounds Raised in the Affidavit-in-Reply:
The respondents raised new grounds in their affidavit-in-reply, including that the petitioner had not obtained GST registration for the commodities being transported and that the driver had stated that the goods were being transported from Sihor to Aurangabad. The court, citing the Supreme Court's decision in Mohinder Singh Gill v. Chief Election Commissioner, held that the validity of an order must be judged by the reasons mentioned in the order itself and cannot be supplemented by fresh reasons in the affidavit. The court found these additional grounds to be irrelevant and not permissible for consideration.

5. Applicability of Circular No. 64/38/2018-GST dated 14.9.2018:
The petitioner referred to Circular No. 64/38/2018-GST, which provided that proceedings under Section 129 of the CGST Act should not be initiated in certain situations, such as minor errors in the invoice or e-way bill. The court noted that the instructions issued by the Central Board of Indirect Taxes and Customs under Section 168 of the CGST Act are binding on the officers and must be followed. The court found that the detention was contrary to the instructions in the circular.

6. Requirement of GST Registration for Specific Commodities:
The respondents contended that the petitioner was not registered for the commodities being transported. The court found that the GST registration form (FORM GST REG-01) only required the top five commodities to be specified and that there was no provision mandating registration for each specific commodity. The court held that the petitioner was not in breach of any provision of the GST Acts by transporting goods not specified in the registration form.

7. Legal Implications of Driver's Statements Regarding the Destination of Goods:
The respondents relied on the driver's statement that the goods were being transported from Sihor to Aurangabad. The court noted that the statutory form (FORM GST MOV-01) recorded the driver's statement that the goods were being transported from Bhavnagar to Virar, Thane. The court found that the destination of the goods had no bearing on the tax liability provided the destination was outside the State of Gujarat. The court held that the driver's statement did not justify the detention of the goods.

Conclusion:
The court concluded that the detention of the truck with goods under Section 129 of the GST Acts was not justified and was based on extraneous grounds not required by the statute. The court quashed the impugned orders of detention and notices issued under Section 129 of the GST Acts and allowed the petitions.

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