Under-valuation disputes must proceed through GST assessment machinery, not detention and penalty when documents are otherwise proper.

Alleged under-valuation of goods, where the invoice, e-way bill and other accompanying documents were otherwise in order, cannot by itself justify detention and penalty under the GST detention provision. The proper course for examining valuation disputes is recourse to the statutory assessment and recovery machinery, including notice under the assessment and demand provisions. Detention and penalty are not the prescribed mechanism for resolving valuation alone. On that basis, the impugned orders were set aside, the challenge succeeded, and consequential relief, including refund of any deposited amount, followed.

---

---

Issues: Whether detention of goods and imposition of penalty under Section 129 of the Uttar Pradesh Goods and Service Tax Act, 2017 could be sustained merely on the ground of alleged under-valuation, when the goods were accompanied by invoice, e-way bill and other relevant documents.

Analysis: The goods were detained only on the allegation that the invoice value was incorrect. There was no dispute regarding the accompanying documents or the description of the goods. Under-valuation is a matter to be examined through the statutory machinery provided for assessment and recovery, and the appropriate course is issuance of notice under Sections 73 or 74 of the Uttar Pradesh Goods and Service Tax Act, 2017. Detention of goods and levy of penalty under Section 129 is not the prescribed mechanism for resolving a dispute of valuation alone.

Conclusion: The detention and penalty were not sustainable and the challenge succeeded.

Final Conclusion: The impugned orders were set aside and the writ petition was allowed, with consequential relief including refund of any deposited amount.

Ratio Decidendi: Alleged under-valuation of goods, without any defect in documents or description, must be proceeded with under the valuation and assessment provisions of the GST law and cannot by itself justify detention and penalty proceedings under Section 129.

---