Technical e-way bill lapse alone cannot justify GST penalty absent evidence of tax evasion or repeated misuse.

Penalty under the Uttar Pradesh GST law could not be sustained where goods were supported by matching invoice documents and the only defect was expiry of the e-way bill. The Court treated the lapse as a technical violation and held that, without material showing repeated misuse of the e-way bill or an attempt to evade tax, penalty under Section 129(3) was unjustified. The appellate order also fell with the penalty, and consequential refund was directed.

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Issues: Whether penalty under Section 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 and the appellate order could be sustained where the only discrepancy was expiry of the e-way bill and no intention to evade tax was found.

Analysis: The goods were accompanied by relevant documents and matched the invoice description. The only irregularity noticed was the expiry of the e-way bill. The Court accepted that a technical violation, by itself, could not justify penalty in the absence of material indicating repeated misuse of the e-way bill or any attempt to evade tax.

Conclusion: The penalty and appellate orders were unsustainable and were set aside, with consequential refund directed.

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