E-way bill exemption for port-to-container freight station movement supports conditional release of detained imported goods pending adjudication.

Movement of imported goods from a port to a container freight station for customs clearance falls within the e-way bill exemption in Rule 138(14)(c) of the CGST Rules, 2017. On that basis, continued detention of the goods was treated as causing unnecessary financial prejudice where the alleged violation required further adjudication. Conditional release was permitted on payment of the disputed tax and furnishing of a bank guarantee for the tax and a portion of the penalty, while preserving the revenue's right to proceed with adjudication and impose lawful tax, penalty and fine if warranted.

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Issues: Whether goods imported and moved from the port to a container freight station for customs clearance were covered by the e-way bill requirement, and whether the detained goods could be released pending adjudication.

Analysis: Rule 138(14)(c) of the Central Goods and Services Tax Rules, 2017 exempts generation of an e-way bill for movement of goods from the port, airport, air cargo complex or land customs station to an inland container depot or a container freight station for customs clearance. On the facts, there was at least an arguable case that the movement from the port of import to the container freight station was not required to be covered by an e-way bill. Since the dispute required detailed consideration, continued detention of the goods was treated as causing unnecessary financial prejudice, while preserving the respondent's right to adjudicate the alleged violation and impose tax, penalty and fine in accordance with law.

Conclusion: The goods were directed to be released on payment of the disputed tax and furnishing of a bank guarantee for the tax and 25% of the tax amount towards penalty, after which adjudication on merits was to proceed.

Final Conclusion: The writ petitions were disposed of by granting conditional release of the detained goods and leaving the merits of the alleged e-way bill violation to be decided in the statutory proceedings.

Ratio Decidendi: Where movement of imported goods falls within the e-way bill exemption for transfer from port facilities to a container freight station, detention should not be continued where a conditional release can safeguard revenue pending adjudication.

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