Non-filling of Part B e-way bill in stock transfers leads to quashing of penalty where no intent to evade tax.

Penalty for non-filling of Part B of an e-way bill in a stock transfer was challenged on the ground of bona fide intention. The authority failed to consider the contention of absence of intent to evade tax, and no provision was shown making in-transit intra-state stock transfers taxable; therefore no evasion could be attributed and the penalty proceedings were vitiated. The administrative orders imposing penalty and the appellate order were quashed, resulting in dismissal of the penalty demand against the consignor on merits of intent and applicability.

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Issues involved:
The issues involved in the judgment are the constitution of GST Tribunal in Uttar Pradesh and the challenge against penalty orders under section 129(3) of the UPGST Act.

Issue 1: Constitution of GST Tribunal in Uttar Pradesh
The petitioner filed a writ petition challenging penalty orders due to the absence of a GST Tribunal in Uttar Pradesh. The Court entertained the petition as no GST Tribunal had been constituted in the state as per the central government's notification.

Issue 2: Challenge against Penalty Orders under Section 129(3) of the UPGST Act
The petitioner, a registered company dealing in production, faced penalty orders for a transportation incident where part 'B' of the e-way bill was not filled. The petitioner argued that it was a transporter's mistake, promptly rectified. The authorities upheld the penalty despite no intent to evade tax and the goods being stock transferred within the state.

The Court observed that the goods were stock transferred from one unit to another within the state, accompanied by proper documents except for the incomplete part 'B' of the e-way bill. The petitioner rectified the discrepancy before the seizure order was passed, showing no intent to evade tax. The Court highlighted the lack of provision for taxing stock transfers within the state.

The Court referred to previous judgments emphasizing the necessity of intent to evade tax for penalty proceedings under the CGST Act. It held that since there was no intention to evade tax in the present case, the penalty orders were unjustified and quashed them.

The Court allowed the writ petition, ordering the refund of any fines or penalties deposited by the petitioner. The respondents were directed to comply with the refund within a month, with interest payable if delayed. The authorities were permitted to recover interest from the responsible officer.

The matter was listed for review after two months for the filing of an affidavit confirming the refund compliance.

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