2020 (2) TMI 524 - HC - GST

Court quashes confiscation notice under GST Act, directs release of goods. Emphasis on contraventions before confiscation.

The Court granted the petitioner's writ application, quashing the notice for confiscation of goods and conveyances under the GST Act. The petitioner, who ... Levy of penalty and confiscation of goods - section 129(1) of the GST Act - writ applicant availed the benefit of the interim-order passed by this Court and got the vehicle, along with the goods released on payment of the tax amount - HELD THAT:- It shall be open for the writ applicant to point out the recent pronouncement of this Court in the case of SSYNERGY FERTICHEM PVT. LTD VERSUS STATE OF GUJARAT [2019 (12) TMI 1213 - GUJARAT HIGH COURT]. It is now for the applicant to make good his case that the show cause notice, issued in Form GST-MOV-10, deserves to be discharged - Application disposed off. Issues:1. Quashing of notice for confiscation of goods and levy of penalty under GST Act2. Direction for release of detained goods and vehicle3. Interim relief during petition proceedings4. Recent pronouncement in a related case5. Discharge of show cause notice issued under GST ActIssue 1: Quashing of Notice for Confiscation and Penalty:The petitioner sought a writ to quash the notice issued for confiscation of goods and conveyances under Section 130 of the GST Act. The Court considered the case where goods were intercepted and seized by authorities during transportation. The petitioner had sold Stainless Steel products to a buyer in Jaipur, with only one invoice generated for a specific quantity. The Court acknowledged the deposit made by the petitioner towards tax and penalty, directing the release of goods and the vehicle. The order was subject to the final outcome of the writ application.Issue 2: Direction for Release of Detained Goods and Vehicle:Upon the petitioner's deposit towards tax and penalty, the Court directed the immediate release of the goods and the vehicle involved in the transportation. The release was granted based on the interim order passed by the Court, allowing the petitioner to retrieve the goods upon payment.Issue 3: Interim Relief During Petition Proceedings:During the pendency of the petition, the petitioner requested interim relief for the release of the detained goods and vehicle. The Court granted the interim order for release based on the petitioner's deposit towards tax and penalty. The authorities were directed to release the goods and vehicle promptly, subject to the final decision on the writ application.Issue 4: Recent Pronouncement in a Related Case:The Court referred to a recent judgment in a related case, highlighting observations on the provisions of Sections 129 and 130 of the GST Act. The judgment emphasized the need for authorities to closely examine contraventions of the Act or Rules and the intent to evade tax before issuing confiscation notices. It stressed the importance of forming a strong case before invoking Section 130 at the initial stage of detention and seizure.Issue 5: Discharge of Show Cause Notice Issued Under GST Act:The Court concluded the writ application by directing the petitioner to establish the discharge of the show cause notice issued under the GST Act. The proceedings were at the stage of the show cause notice under Section 130, and the Court disposed of the application while making the rule absolute to the specified extent.This detailed analysis of the judgment outlines the issues addressed by the Court concerning the quashing of notices, release of detained goods, interim relief, recent legal pronouncements, and the discharge of show cause notices under the GST Act.