Tax Authorities Violated Section 129 CGST Act During Vehicle Detention for Route Deviation Due to Mechanical Issues

The HC ruled in favor of the petitioner, finding that tax authorities violated Section 129 of the Central Goods and Services Tax Act, 2017 during detention of a vehicle transporting iron scrap. The vehicle had deviated from its route due to mechanical issues when intercepted. The court determined the detention was invalid as no proper detention order was issued, the driver's adverse statement was not shared with the petitioner, and no notice specifying penalty was provided within the statutory 7-day period. The court ordered immediate release of the vehicle and goods within 24 hours.

---

---

Issues:
Violation of provisions of Section 129 of the Central Goods and Services Tax Act, 2017 regarding detention and seizure of goods without proper legal procedures.

Analysis:

The petitioner had purchased iron scrap and was transporting it when the vehicle carrying the consignment faced mechanical difficulty, leading to a deviation from the planned route. Subsequently, the vehicle was intercepted by the Deputy Tax Officer, who alleged that the goods were being re-routed without a proper e-way bill. However, the petitioner was not provided with a copy of the adverse statement made by the driver, which formed the basis of the interception.

The judgment highlighted the provisions of Section 129 of the Central Goods and Services Tax Act, 2017, which govern the detention and seizure of goods during transportation. It was noted that the impugned retention of the vehicle was invalid as no order of detention had been issued at the time of seizure, as required by law. Additionally, the proper officer had not issued a notice specifying the penalty payable within 7 days of the seizure, further violating statutory provisions.

The court found that the respondent's insistence on retaining the vehicle without following the legal procedures outlined in Section 129 was a clear contravention of the statutory provisions. Consequently, the petitioner was deemed to have succeeded in the case, and the relief sought was granted. The court ordered the release of the conveyance and goods contained therein within 24 hours, emphasizing the importance of adhering to legal procedures in such matters.

In conclusion, the writ petition was allowed, and the court issued a mandamus to release the vehicle and goods, emphasizing the necessity of following the prescribed legal procedures in cases of detention and seizure of goods during transportation.

---