Petitioner with valid tax invoice and E-way bills wins against detention orders under Section 129(1)(b)

The HC quashed tax and penalty orders on detained goods where petitioner possessed proper documentation including tax invoice, GR, and E-way bills showing dispatch from Ghaziabad. The court found no evidence of purchase from non-bonafide dealer and no discrepancies in quality, quantity, or specifications of goods. Since petitioner appeared before authorities and claimed ownership with valid documents, Section 129(1)(b) proceedings were deemed inappropriate. The state failed to prove any intention to avoid tax payment, resulting in petition being allowed.

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Issues:
Petitioner seeking relief through a writ petition against an order imposing tax and penalty on detained goods.

Analysis:
The petitioner, a registered dealer in MS scrape, sold goods to a buyer in Uttarakhand with proper documents. The goods were intercepted during transit, leading to detention and imposition of tax and penalty. The petitioner contended that all required documents were in order, as per GST Act and Rules. The petitioner argued that the detention was unjustified, citing relevant circulars and judgments supporting their case. The respondent, however, claimed that the petitioner's actions were contradictory and intended to evade tax. After reviewing the records, the Court found that the goods were accompanied by valid documents, and there was no evidence of tax avoidance. The Court noted that the respondent failed to prove any malintent or discrepancies in the transaction. The circulars referred to by the petitioner supported their claim that proper documents were in order, and the detention was unwarranted.

The Court highlighted the circular stating that if specific documents accompany the goods, the consignor or consignee is deemed the owner. The petitioner's presence before the authority indicated compliance, and proceedings under a specific section were deemed inappropriate. Referring to previous judgments, the Court emphasized that penalties should not be imposed when the consignor claims ownership with valid documents. Based on the facts and legal precedents, the Court quashed the impugned orders, ruling in favor of the petitioner. The writ petition was allowed, directing the refund of any deposited amount within a specified timeframe.

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