2023 (2) TMI 538 - HC - GST

Vehicle seizure upheld for expired E-way bill under Section 129 CGST Act despite penalty payment

The Calcutta HC dismissed a petition seeking release of a seized vehicle and goods due to an expired E-way bill. The court held that Section 129 of the ... Imposition of SGST and penalty - seeking release of seized vehicle alongwith goods - expired E-way bill - HELD THAT:- Section 129 of the Central Goods and Services Tax Act, 2017 empowers the statutory authority to detain the vehicle and seize the goods. The goods shall be released only on payment of penalty equal to 200% of the tax payable on such goods. Under the fact and circumstances of the case this Court finds that the respondent authority is lawfully permitted to impose penalty under Section 129 as well as the SGST as the goods were found to be detained in the territory of the State. The ratio laid down in M/s Hanuman Ganga Hydroprojects Private Limited [2022 (7) TMI 603 - CALCUTTA HIGH COURT] are not applicable in the instant case as in that case it was held that This Court already held that there is no lack of bona fide on the part of the writ petitioner in the instant case for not extending the validity period of the E-Way bill within the short period of time. It is also not a case of willful attempt on the part of the writ petitioner to evade payment of tax - It is the admitted position that the petitioner has paid the amount of penalty levied by the adjudicating authority and the vehicle was also released thereafter. Petition dismissed. Issues:Assault on imposition of SGST and penalty for expired E-Way bill.Analysis:The petitioner, a manufacturer/supplier of Bitumen Emulsion, faced SGST and penalty imposition for an expired E-Way bill during transportation. Despite paying IGST and generating a valid E-Way bill, the consignment faced a breakdown, leading to detention in West Bengal. The Assistant Commissioner imposed SGST and penalty, which the petitioner contested.The petitioner argued that the breakdown was unforeseen, and there was no intention to evade tax. Referring to GST as a destination-based tax, the petitioner contended that as the goods could not proceed due to the breakdown in West Bengal, no additional tax should be levied. The petitioner cited previous court judgments to support their stance.The respondent contended that the expired E-Way bill indicated delivery within West Bengal, empowering the imposition of SGST and penalty under Section 129 of the GST Act. The petitioner's failure to extend the E-Way bill during the breakdown period was highlighted, justifying the tax and penalties imposed.The Court upheld the authority's power under Section 129 to detain the vehicle and impose penalties, considering the circumstances of the case. The judgments cited by the petitioner were deemed inapplicable, and the dismissal of the writ petition was based on the lawful imposition of SGST and penalties due to the goods' detention in West Bengal.Therefore, the Court dismissed the writ petition without costs, affirming the imposition of SGST and penalties for the expired E-Way bill during the consignment's breakdown in West Bengal.