2022 (12) TMI 954 - HC - GST

Landmark GST Ruling: Transit Goods Release Authorized with Tax Deposit, Preserving Legal Challenge Rights Under Sections 129 and 130

HC addressed jurisdictional dispute between Sections 129 and 130 of GST Act regarding goods in transit. Court granted interim relief by directing release ... Confiscation of goods alongwith conveyance - whether when the goods are in transit, the authorities are entitled to invoke Section 129 of the Act or not? - HELD THAT:- What is prayed by the petitioner herein by way of the interim relief is to stay the operation and implementation of the order in FORM MOV-11 No. 182 dated 31.05.2022, confiscating the goods and conveyance of the petitioner and demanding tax, fine and penalty. While a blanket stay of the said order as prayed for cannot be granted, relief regarding release of goods and conveyance could be considered in favour of the petitioner upon imposing conditions. As could be seen from the impugned order, the penalty amount is Rs. 12,35,430/-. The fine and other charges are demanded to the extent of Rs.68,63,500/- and the tax is demanded of Rs.12,35,430/- - it is directed that the respondents shall release the goods and conveyance of the petitioner, confiscated and detained pursuant to the aforementioned order No. 182 dated 31.05.2022, subject to conditions imposed. The goods and conveyance of the petitioner be released by the authorities - the petitioner deposits the amount of tax of Rs. 12,35,430/- - petitioner deposits the amount of penalty to the tune of Rs. 12,35,430/- - petitioner furnishes bond to the tune of Rs. 68,63,500/- towards the amount of fine. Application allowed. Issues:1. Jurisdictional issue regarding the invocation of Sections 129 and 130 of the Goods and Services Tax Act, 2017 for goods in transit.2. Interim relief sought by the petitioner regarding the confiscation of goods and conveyance, along with the demand for tax, fine, and penalty.Jurisdictional Issue:The High Court addressed the challenge to an order passed by the State Tax Officer under Section 130 of the GST Act, involving the confiscation of goods in transit. The petitioner contended that the authority should have acted under Section 129, not Section 130, as the goods were intercepted during transit. The petitioner argued that Section 129 is a goods-specific provision, while Section 130 is assessee-specific. The Court acknowledged the availability of an appeal under Section 107 but noted the jurisdictional significance of determining the correct section for exercising powers in such cases.Interim Relief:The petitioner sought to stay the implementation of the confiscation order demanding tax, fine, and penalty. Referring to a previous case with a similar issue, the petitioner requested interim relief based on conditions previously imposed by the Court. The Court directed the release of the goods and conveyance upon the petitioner meeting specific conditions. These conditions included depositing the tax and penalty amounts, as well as furnishing a bond for the fine. Once the petitioner complied with these conditions, the authorities were instructed to release the goods and conveyance. The Court emphasized that this order for interim relief would be part of the main case, ultimately allowing and disposing of the civil application in favor of the petitioner.This detailed analysis covers the jurisdictional issue related to the application of Sections 129 and 130 of the GST Act and the interim relief sought and granted by the High Court in response to the petitioner's concerns regarding the confiscation of goods and conveyance.