Appellate Authority overturns tax penalty due to typographical error, cites Circulars & Court judgment

The Appellate Authority accepted the appellant's argument regarding a typographical error in the e-way bill, deeming it a minor mistake. Referencing CBIC Circular No. 64/38/2018-GST and a Kerala High Court judgment, the authority concluded that the tax and penalty imposed under Section 129 were unwarranted. The initial order was set aside, and a refund of the deposited amount of Rs. 1,54,798/- (IGST Rs. 77,399/- + penalty Rs. 77,399/-) was directed. Instead, a nominal penalty of Rs. 500/- under SGST and Rs. 500/- under CGST was imposed in line with relevant circulars.

---

---

Issues Involved:
1. Typographical error in e-way bill.
2. Validity of e-way bill.
3. Imposition of tax and penalty under Section 129 of CGST/HPGST Act.
4. Applicability of CBIC Circular No. 64/38/2018-GST.
5. Judicial precedents and legal provisions.

Issue-Wise Detailed Analysis:

1. Typographical Error in E-Way Bill:
The appellant argued that the error in the e-way bill, which mentioned the distance as 20 kilometers instead of 2000 kilometers, was merely a typographical mistake. This error resulted in the e-way bill's validity being calculated for one day instead of the required twenty days. The appellant contended that this mistake was unintentional and should be considered minor.

2. Validity of E-Way Bill:
The consignment was intercepted on 15th September 2018, with the e-way bill having expired on 8th September 2018. The appellant maintained that despite the expired e-way bill, all other documents were in order and compliant with the GST rules. The appellant cited that the typographical error led to the e-way bill's premature expiration, which was beyond their control to rectify at the time of interception.

3. Imposition of Tax and Penalty under Section 129 of CGST/HPGST Act:
The Assistant Commissioner (AC) imposed a tax and penalty under Section 129 of the CGST/HPGST Act, arguing that the expired e-way bill was a violation of Rule 138. The appellant contested this imposition, arguing that the error was minor and did not warrant such a penalty. The appellant had deposited the tax and penalty under protest to release the goods.

4. Applicability of CBIC Circular No. 64/38/2018-GST:
The appellant referenced CBIC Circular No. 64/38/2018-GST, which states that minor errors in e-way bills, such as typographical mistakes, should not lead to the initiation of proceedings under Section 129. The appellant argued that their case fell within the scope of this circular, which should mitigate the penalty imposed.

5. Judicial Precedents and Legal Provisions:
The appellant cited the Kerala High Court judgment in SABITHA RIYAZ VS THE UNION OF INDIA, which held that typographical errors in e-way bills should be treated as minor mistakes. The Kerala High Court directed that such errors should not result in the detention of goods if other documents are in order. The appellant argued that their case was similar and should be treated accordingly.

Judgment:
The Appellate Authority accepted the appellant's arguments, recognizing the typographical error as a minor mistake. The authority referenced the CBIC Circular No. 64/38/2018-GST and the Kerala High Court judgment, concluding that the imposition of tax and penalty under Section 129 was not warranted. The authority set aside the order of the Assistant Commissioner and directed the refund of the deposited amount of Rs. 1,54,798/- (IGST Rs. 77,399/- + penalty Rs. 77,399/-). Instead, a nominal penalty of Rs. 500/- under SGST and Rs. 500/- under CGST was imposed in accordance with the relevant circulars.

---