Court orders release of seized vehicle upon payment of SGST & CGST despite IGST charge

The court found the petitioner liable to pay SGST & CGST for an intra-state supply despite the supplier charging IGST for an inter-state supply. The respondent was directed to release the seized vehicle upon the petitioner's payment of the applicable SGST and CGST as a deposit. The court ordered the respondent to issue a notice for further proceedings, with the amount paid considered a deposit against any confirmed liability. The writ petition was disposed of without costs, and the related Writ Miscellaneous Petition was closed accordingly.

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Issues:
Challenge to impugned proceedings in Form GST Mov 1 dated 06.11.2021; Seizure of goods and vehicle due to expired E-way bill and technical snag; Liability to pay SGST & CGST for intra-state supply.

Analysis:
The petitioner challenged the impugned proceedings in Form GST Mov 1 dated 06.11.2021. The petitioner had a unit in Thuvakudi in Trichy and had placed an order from a supplier in Chennai for supply of goods. The supplier had raised a GST invoice for an inter-state supply and consigned the goods to the petitioner's place of business in Trichy, billing the petitioner's Head Office in Telangana. The respondent seized the vehicle due to an expired E-way bill and technical issues. The petitioner argued that the supplier had charged IGST for the inter-state supply. The court noted that the supply was actually intra-state, from Chennai to Trichy, making the petitioner liable to pay SGST & CGST. Consequently, the respondent was directed to release the vehicle upon payment of the applicable SGST and CGST by the petitioner as a deposit.

The court directed the respondent to issue a notice to the petitioner to show cause why the SGST and CGST should not be demanded and why a penalty should not be imposed. The amount paid by the petitioner would be treated as a deposit against any confirmed liability by the respondent, with its appropriation subject to the outcome of further proceedings. The court disposed of the writ petition with these observations, stating no costs were to be incurred. The connected Writ Miscellaneous Petition was also closed as a result of the judgment.

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