Wrong GST penalty clause led to setting aside of the order and remand for fresh consideration.

A penalty order under the GST movement provisions was challenged on the ground that the facts attracted Section 129(1)(a), not Section 129(1)(b). The clarification dated 31.12.2018 and an earlier coordinate bench decision were treated as covering the controversy, and the respondents did not dispute that position. The High Court set aside the impugned penalty order and remanded the matter to the competent authority for fresh consideration under the correct provision.

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Issues: Whether the penalty order passed under Section 129(1)(b) was liable to be set aside for having been imposed under the wrong clause, and whether the matter required fresh consideration by the competent authority.

Analysis: The penalty was imposed under Section 129(1)(b), while the challenge was that the facts attracted Section 129(1)(a). The relevant clarification dated 31.12.2018 and the earlier coordinate bench decision were treated as covering the controversy, and the position was not disputed by the respondents.

Conclusion: The impugned penalty order was set aside and the matter was remanded to the competent authority to pass a fresh order in accordance with the observations made.

Final Conclusion: The petitioner obtained relief against the impugned penalty order, but the dispute was sent back for fresh adjudication by the competent authority.

Ratio Decidendi: Where a penalty under the GST movement provisions is imposed under an inapplicable clause, the order is liable to be set aside and the matter remanded for reconsideration under the correct provision.

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