Direct invocation of Section 130 CGST for tax evasion upheld; writ relief denied, taxpayer directed to alternate remedies

HC interpreted the post-amendment Section 130 CGST Act to hold that where there is contravention of the Act with intent to evade tax, the goods and conveyance are liable to confiscation and the person to penalty. Relying on Clause (l) of the relevant circular, HC held that the proper officer was legally entitled to directly invoke Section 130 and issue notice in Form GST MOV-10 after issuance of MOV-1 and MOV-2. Finding no extraordinary circumstances warranting interference under Article 226, HC declined to exercise its writ jurisdiction to set aside the confiscation order and relegated the petitioner to the alternate statutory remedies under the GST enactments. The writ petition was dismissed.

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Issues involved:
The judgment involves the quashing of a confiscation order passed by the first respondent under the GST Acts.

Factual Matrix:
The petitioner, a registered dealer under the GST Acts, filed monthly returns and availed Input Tax Credit. The petitioner sold iron scrap to a dealer in Goa and the goods were intercepted during transit. Notices were issued for physical verification, leading to a confiscation order.

Contentions:
The petitioner argued that proceedings should have first been initiated under Section 129 before Section 130 of the CGST Act. The petitioner claimed that the registration certificate and documents disprove fake supplies. The government pleader contended that the petitioner engaged in fraudulent activities and evaded GST, urging dismissal of the petition.

Legal Analysis:
Section 130 of the CGST Act allows for confiscation of goods or conveyances in case of contravention with intent to evade tax. The post-amendment regime treats Sections 129 and 130 as independent. The first respondent issued a show cause notice under Section 130, leading to the confiscation order.

Decision:
The court found no extraordinary circumstances to set aside the confiscation order and dismissed the writ petition. The petitioner was advised to pursue statutory remedies under the GST Acts. The judgment highlights the importance of following due process under the GST laws.

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