2023 (9) TMI 787 - HC - GST

Goods Detention Overturned: Typographical Error Leads to Unjustified Penalty Under Section 129(3)

The HC found that detention of goods due to a typographical invoice error was unjustified. The respondent violated Section 129(3) by not passing orders ... Seeking release of vehicle detained with goods - delay in passing the order - typographical error or not - certain errors made while preapring invoices - HELD THAT:- On perusing the Tax Invoice, it is seen that in the Billed To column, the said M/s. Rashmi has correctly mentioned Tvl. T.M. Steel with correct address of Tvl. T M Steel and has also mentioned its GST number. However, in the Shipped To column, instead of mentioning Tvl. T. Balaji, it has mentioned as Tvl.TM Steel. But in address column, it has been clearly mentioned Tvl. T. Balaji address as Devapuram Road, Thoothukudi. Therefore, it can be considered as typographical error only. Moreover, it is not the mistake of Tvl.TM Steel, it is the mistake committed by M/s.Rashmi. Moreover, as rightly pointed out by the Learned Counsel appearing for the petitioner that the respondent has not passed order with 7 days from the date of service of such notice. It is seen that the respondent intercepted the consignment on 24.07.2023 and issued a detention order on 24.07.2023, the petitioner had filed a reply on 27.07.2023. But till 31.07.2023 the respondent had not passed any order, the respondent ought to have passed an order on or before 31.07.2023. Even the respondent had not passed any order when this order is passed today. Under Section 129(3) of the Act, the order ought to be passed within 7 days from the date of serve of such notice. Since there is clear violation of the provisions of the Act and hence the detention of goods is against the provisions. The petitioner is directed to pay Rs. 5,000/- (Rupees Five Thousand only) as penalty to the respondent. On such payment, the respondent shall release the goods - petition allowed. Issues involved:The issues involved in the judgment are typographical error in invoices leading to detention of goods, violation of provisions under Section 129(3) of the Act regarding passing of orders within a specified time frame, and the authority's penalization of the petitioner for a mistake committed by a third party.Typographical error in invoices:The petitioner, a manufacturer of TMT steel and iron bar, placed an order for the supply of goods with M/s. Rashmi Metaliks Limited. However, a typographical error was made by M/s. Rashmi in the invoices by mentioning 'Tvl.T.M. Steel' instead of 'Tvl.T. Balaji' in the 'Shipped To' column. The respondent detained the consignment and penalized the petitioner for this error. The Court observed that the mistake was typographical as the correct address of Tvl.T. Balaji was mentioned, and the respondent failed to question M/s. Rashmi regarding the error. The detention of goods was deemed unjust as the petitioner was not at fault.Violation of provisions under Section 129(3) of the Act:The respondent intercepted the consignment and issued a detention order without passing any further order within the stipulated 7-day period from the date of service of notice. The Court noted the clear violation of Section 129(3) of the Act, which requires orders to be passed within the specified timeframe. As a result, the detention of goods was deemed to be against the provisions of the Act.Penalization of petitioner for third-party mistake:The Court directed the petitioner to pay a penalty of Rs. 5,000 to the respondent for the release of goods, modifying the impugned penalty order. The authorities were instructed to inform M/s. Rashmi Metaliks Limited of the mistake and take appropriate action against them. The petitioner was granted the liberty to challenge the modified penalty before the authorities. The Writ Petition was allowed with the mentioned directions, and no costs were imposed.