2022 (9) TMI 663 - HC - GST

Timber Transport Dispute: GST Detention Highlights Procedural Gaps in E-way Bill Compliance and Statutory Remedy Pathways

HC ruled on a GST detention case involving timber transport discrepancies. The court found the factual disputes unsuitable for writ jurisdiction and ... Detention and seizure under Section 129(1) of the CGST/WBGST Act - appellate remedy under Section 107 of the CGST Act - writ jurisdiction under Article 226 of the Constitution - role of constitutional court in fact findingDetention and seizure under Section 129(1) of the CGST/WBGST Act - role of constitutional court in fact finding - Challenge to detention of goods and detention order under Section 129(1) dismissed in writ jurisdiction on grounds that factual disputes require administrative/appellate adjudication - HELD THAT: - The Court found that the core controversy-whether the goods carried (teak sawn timber) matched declarations in the e way bill, invoice and certificate, and whether the consignor existed at the declared place of business-was a disputed question of fact based on the investigation and physical verification recorded by the GST authority. In such circumstances the High Court exercising jurisdiction under Article 226 will not act as a fact finding or verification authority to re adjudicate those factual findings. The petitioner was directed to pursue statutory remedies; the order under Section 129(1) is amenable to challenge before the appellate forum under Section 107 of the Act. The respondent was directed to supply the written instruction and supporting documents to the petitioner so that appropriate statutory proceedings may be taken.Writ petition dismissed; factual disputes left for administrative/appellate determination and petitioner directed to avail statutory remedy under Section 107; instruction to be handed over to petitioner.Final Conclusion: Writ petition dismissed as the challenge to the detention/seizure involves disputed factual questions unsuitable for resolution under Article 226; petitioner directed to pursue remedy before the statutory appellate forum and provided copy of the respondent's instruction to enable such proceedings. Issues involved:Challenging an order passed by the respondent GST authority under Section 129(1) of the CGST Act and WBGST Act, 2017 regarding the detention of goods due to discrepancies in the declaration made in the E-way bill and invoices, and the non-existence of the consignor at the registered place of business.Analysis:The petitioner challenged the impugned order passed by the respondent GST authority under Section 129(1) of the CGST Act and WBGST Act, 2017. The respondent State GST authority conducted a physical verification of goods on 10th August, 2022, based on GST FORM MOV-03 issued for extending the date for physical checking. The verification revealed discrepancies, including an excess of approximately 312 cubic feet of teak sawn timber compared to the declared amount in the E-way bill and invoice. Additionally, the measurement details of the timber did not match the driver's slip. It was found that the vehicle was carrying a different consignment than what was mentioned in the tax invoice, E-way bill, and Certificate of Forest Department. Moreover, the consignor was not present at the registered place of business, indicating an attempt to avoid tax liability. Consequently, the goods were seized, and the vehicle was detained under Section 129 of the WBGST Act, 2017. A show cause notice was issued to the driver for contravention of Section 68 read with Section 129 and Rule 138 of the GST Act.The High Court noted that the issue involved a highly disputed question of fact regarding the discrepancies in the declaration of the 'Teak Sawn Timber' and the non-existence of the consignor at the registered place of business. The Court clarified that in the exercise of constitutional writ jurisdiction under Article 226 of the Constitution of India, it cannot act as a fact-finding authority over the transported goods in question. If the petitioner is dissatisfied with the reasons for the detention of the goods and the order passed under Section 129(1) of the Act, the remedy lies in appealing before the appellate forum under Section 107 of the Act. The respondent was directed to provide a copy of the instruction to the petitioner's advocate for pursuing the appropriate statutory remedy either before the appellate forum or the concerned Officer as per the law. Consequently, the writ petition was disposed of with these observations and directions.