Physical tax invoice required under GST transit rules, and route deviation alone cannot sustain penalty without evidence of tax evasion.

Physical carriage of the tax invoice remained mandatory under Rule 138A of the West Bengal GST Rules, 2017, except in the limited case of invoices generated in the prescribed QR code and IRN manner; displaying an invoice image on a mobile device was not compliant. On the penalty issue, mere deviation from the declared route, without discrepancy in the goods or material showing intent to evade tax, did not justify invocation of Section 129 of the West Bengal GST Act, 2017. The penalty and appellate orders were therefore unsustainable, and refund of the penalty already paid was left open.

---

---

Issues: (i) Whether the person in charge of a conveyance was required to carry a physical copy of the tax invoice, or whether display of the invoice image on a mobile device amounted to compliance with Rule 138A of the West Bengal Goods and Service Tax Rules, 2017. (ii) Whether mere deviation from the declared route, without any discrepancy in the goods or intention to evade tax, justified invocation of Section 129 of the West Bengal Goods and Service Tax Act, 2017 and the imposition of penalty.

Issue (i): Whether the person in charge of a conveyance was required to carry a physical copy of the tax invoice, or whether display of the invoice image on a mobile device amounted to compliance with Rule 138A of the West Bengal Goods and Service Tax Rules, 2017.

Analysis: Section 68 of the West Bengal Goods and Service Tax Act, 2017 empowers the proper officer to require production of prescribed documents during movement of goods. Rule 138A requires the person in charge of a conveyance to carry the invoice or bill of supply or delivery challan and the e-way bill or e-way bill number. The electronic production of a tax invoice is permitted only in the specific case covered by Rule 138A(2), namely invoices generated in the prescribed QR code and IRN manner. Outside that exception, the statutory requirement is to carry the physical invoice. The alleged display of an invoice image on a mobile phone did not satisfy the rule.

Conclusion: The requirement to carry the physical copy of the tax invoice applied, and mobile display of the invoice image was not sufficient compliance.

Issue (ii): Whether mere deviation from the declared route, without any discrepancy in the goods or intention to evade tax, justified invocation of Section 129 of the West Bengal Goods and Service Tax Act, 2017 and the imposition of penalty.

Analysis: No provision under the Act or the Rules was shown to cast an obligation on the dealer to disclose the route for transportation of goods. Mere interception at a point not matching the declared route, by itself, does not establish evasion of tax. The e-way bill was produced, there was no dispute regarding the quantity or quality of goods, and no finding of intention to evade tax was returned by the appellate authority. In the absence of material indicating evasion, Section 129 could not be invoked merely because the vehicle was on a different route.

Conclusion: Mere route deviation, without evidence of tax evasion or discrepancy in the goods, did not justify penalty under Section 129.

Final Conclusion: The penalty order and the appellate order were unsustainable in law, and the writ petition succeeded with liberty to seek refund of the penalty already paid.

Ratio Decidendi: Under the GST regime, physical carriage of the tax invoice is mandatory unless the case falls within the specific electronic-invoice exception, and penalty under Section 129 cannot rest merely on route deviation absent evidence or finding of intention to evade tax.

---