Penalty Orders Under UP GST Act Quashed; Court Orders Refunds After Invalid Search of Petitioner's Premises.

The HC quashed the penalty orders issued under Section 129(3) of the Uttar Pradesh GST Act, 2017, following a search of the petitioner's premises, ruling them unjustified. The orders dated June 18, 2018, and June 14, 2019, were set aside. The respondents were directed to refund the tax and penalty amounts within four weeks. The writ petition was allowed, granting consequential reliefs to the petitioner.

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Issues involved:
The judgment deals with penalty orders u/s 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 and orders passed in appeal u/s 107 of the Act subsequent to a search of the petitioner's business premises.

Penalty Proceedings u/s 129(3) of the Act:
The Court referred to previous judgments to establish that penalty proceedings under Section 129 of the Act cannot be initiated solely based on a search and seizure of premises. Citing cases Mahavir Polyplast Pvt. Ltd. Vs. State of U.P. and Poddar Trading Company vs. Commissioner, Commercial Tax, U.P., the Court held that the penalty in the present case was not justified. Consequently, the impugned orders dated June 18, 2018 and June 14, 2019 were quashed and set aside.

Refund of Tax and Penalty:
The Court directed the respondents to refund the tax and penalty amount deposited by the petitioner within four weeks from the date of the judgment.

Conclusion:
The instant writ petition was allowed, and the Court granted consequential reliefs to follow.

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