GST detention and penalty fail where invoice, e-way bill and matching goods show only a technical e-way bill defect, not evasion.

Penalty and detention under the Uttar Pradesh GST Act were held unsustainable where the goods were accompanied by the invoice and e-way bill, the goods description matched the invoice, and only Part B of the e-way bill was initially unfilled. That omission was corrected immediately and before the detention order, showing a technical lapse rather than a violation of substance. The court also noted that IGST had already been paid at import, leaving no basis for further tax liability under the Act. In the absence of material indicating an intent to evade tax, the penalty and appellate orders were quashed and consequential relief followed.

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Issues: Whether penalty and detention orders under the Uttar Pradesh Goods and Services Tax Act, 2017 were sustainable where the invoice and e-way bill accompanied the goods, the goods description matched the invoice, only Part B of the e-way bill was initially not filled, and IGST had already been paid on import.

Analysis: The goods were found to be accompanied by the invoice and e-way bill, and the description of the goods matched the invoice. The only lapse was non-filling of Part B of the e-way bill at the time of interception, which was rectified immediately thereafter and before the detention order. The Court also noted that IGST had already been paid at the time of import, leaving no basis for further tax liability under the Act. In these circumstances, the omission was a technical defect and there was no material indicating an intention to evade tax.

Conclusion: The penalty and appellate orders were unsustainable and were quashed. The writ petition was allowed and consequential relief followed.

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