2022 (4) TMI 704 - HC - GST

Petition allowed quashing tax penalty orders under Section 129 CGST Act for erroneous e-way bill generation

M/s. Create Consults, Represented Through Its Proprietor Shri Ralston Anil Rajvaidya Versus The State of Madhya Pradesh Through Principal Secretary, Commissioner, State GST, Joint Commissioner, State Tax Cum Appellate Officer State GST, State Tax Officer, Office of Assistant Commissioner, Madhya Pradesh

M/s. Create Consults, Represented Through Its Proprietor Shri Ralston Anil Rajvaidya Versus The State of Madhya Pradesh Through Principal Secretary, ... Issues:1. Challenge to orders dated 24/06/2019 and 31/10/2019 passed by Sales Tax Officer and Joint Commissioner, State Tax cum Appellate Officer, State GST.2. Request for refund of penalty amount imposed on petitioner.3. Discrepancy in e-way bill details leading to penalty imposition.4. Appeal against the penalty and tax imposition.5. Delay in challenging the orders due to Covid-19 outbreak.Analysis:1. The petitioner challenged the orders dated 24/06/2019 and 31/10/2019 passed by the Sales Tax Officer and Joint Commissioner, State Tax cum Appellate Officer, State GST, seeking a refund of the penalty amount of Rs. 89,422 along with interest. The case involved the petitioner's inadvertent error in generating the e-way bill for the transportation of goods, leading to a penalty imposition under Section 129 of the Central Goods and Service Tax Act, 2017.2. The petitioner, engaged in selling P & G recycled bags, mistakenly mentioned its details instead of the manufacturer's details in the e-way bill. Despite the petitioner's submission that it was a bona fide error, the authorities imposed the penalty. The petitioner deposited the penalty amount under compulsion and appealed the decision, but due to a delay in communication, the appeal was dismissed. The petitioner argued that the mistake was typographical/clerical and cited a similar case where a clerical error was considered a minor mistake.3. The respondents contended that the mistake was deliberate, given the experience and registration of both the seller and the purchaser in GST matters. They opposed the petitioner's reliance on a previous case, emphasizing the distinguishable facts. However, upon detailed examination of the courier receipt/invoice and the e-way bill, the court found that the mistake was indeed a clerical error. The court noted that all other details in the e-way bill matched the actual transaction, indicating a bona fide error in the generator's name.4. Referring to a circular by the Ministry of Finance, the court agreed with a previous co-ordinate bench decision that minor discrepancies in e-way bill details should not lead to penalty imposition. Given the identical nature of the present case to the previous case, the court quashed the impugned orders and directed the respondents to consider imposing a minor penalty, treating the error as a clerical mistake as per the circular.5. Ultimately, the court allowed the writ petition, quashed the orders dated 24/06/2019 and 31/10/2019, and directed the authorities to consider imposing a minor penalty. The court acknowledged the delay in challenging the orders due to the Covid-19 outbreak and made no order as to costs.