Penalty order set aside for E-Invoice goods mismatch due to violation of fair hearing rights

The HC set aside a penalty order imposed on a petitioner for transporting goods different from those disclosed in the E-Invoice. The court found that the petitioner's right to fair hearing was violated as relied-upon documents were not properly supplied. The revenue authority's claim of providing documents to the truck driver was unconvincing due to inadequate documentation of the receipt process. The court directed the revenue authority to provide all adverse material within one week, allowing the petitioner to reply before passing a fresh order under Section 129 of the UP GST Act, 2017.

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Issues involved: Challenge to penalty imposed u/s GST MOV-09 for transportation of goods; Violation of opportunity of hearing and non-supply of relied upon documents.

Challenge to Penalty Imposed u/s GST MOV-09:
The petitioner contested an order imposing a penalty of Rs. 11,87,525 for transporting goods different from those disclosed in the E-Invoice. The discrepancy was based on a lab report from Anni Laboratories. The petitioner argued that they were not provided with the lab report before the penalty was imposed, thus denying them the opportunity to challenge the findings.

Violation of Opportunity of Hearing and Non-Supply of Documents:
The petitioner claimed that their right to a fair hearing was compromised as they were not supplied with the relied upon documents, specifically the lab report from Anni Laboratory. The revenue authorities argued that since a copy of the lab report was given to the truck driver, they were not obligated to provide a second copy to the petitioner. However, the court found discrepancies in the handling of the document and directed the revenue authority to provide all adverse material to the petitioner for a fair opportunity to respond.

The High Court set aside the impugned order and directed the revenue authority to provide all adverse material to the petitioner within a week. The petitioner was given one week to respond, and a fresh reasoned order was to be passed within two months to conclude the proceedings. The court emphasized the importance of proper documentation in cases involving detention or seizure of goods to prevent malpractices and ensure justice.

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