Petitioner Wins GST Challenge: Minor E-Way Bill Deviation Doesn't Constitute Intentional Tax Evasion Under Section 129(3)

HC ruled in favor of petitioner, quashing penalty orders under Section 129(3) of UP GST Act. The court found no intentional tax evasion despite e-way bill expiry and minor weight discrepancy. Authorities were directed to refund tax and penalty within four weeks, emphasizing reasonable explanation provided by petitioner and absence of deliberate misconduct.

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Issues:
The issues involved in the judgment are the imposition of penalty under Section 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 based on the expiry of the e-way bill and a discrepancy in the weight of goods.

Imposition of Penalty based on E-way Bill Expiry:
The petitioner challenged the penalty imposed under Section 129(3) of the Act due to the expiry of the e-way bill nine hours before the interception of goods. The Court noted that the expiry of the e-way bill alone, without any intention to evade tax, does not warrant the imposition of a penalty, as established in previous judgments. The authorities failed to consider the petitioner's explanation and the fact that the goods were being transported from the supplier to the purchaser with matching quantities in the documents.

Discrepancy in Weight of Goods:
Another issue raised was a discrepancy in the weight of the goods, where the actual weight found was 5,805 kilograms instead of the expected 6,240 kilograms. The petitioner explained that the difference was due to delivering a portion of the goods to Shamli before transporting the rest to Muzaffar Nagar for the same purchaser. The Court found that the explanation provided by the petitioner was reasonable and that there was no intention to evade tax.

Judgment Summary:
The Court quashed the orders imposing penalty and the appeal order, directing the respondents to refund the tax and penalty amount within four weeks. It was held that there was no intention to evade tax, as evidenced by the factual details provided by the petitioner. The writ petition was allowed, with no costs imposed.

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