Mandatory e-way bill compliance under GST supports detention and penalty when vehicle details mismatch or the bill has expired

After the Uttar Pradesh GST Rules amendment made e-way bill compliance mandatory, movement of goods without a valid e-way bill could justify detention and penalty. Where one consignment was carried in a vehicle different from the vehicle entered in Part B of the e-way bill, and another e-way bill had expired before interception, the authorities were entitled to invoke the detention and penalty provisions. The court treated non-compliance as raising a rebuttable presumption of intent to evade tax, and held that later production of documents did not by itself cure the defect. The challenge to the penalty and appellate order therefore failed.

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Issues: Whether penalty and detention under the goods and services tax law were sustainable where the goods were moved with a mismatched vehicle entry in the e-way bill and another e-way bill had expired before interception.

Analysis: After the 14th Amendment to the Uttar Pradesh Goods and Services Tax Rules, 2017, valid e-way bill compliance became mandatory for movement of goods. Where goods are intercepted without a valid accompanying e-way bill, a rebuttable presumption of intention to evade tax arises. Mere production of documents after interception does not, by itself, undo the consequence of non-compliance. The facts showed that one consignment was transported through a vehicle different from the vehicle declared in Part B of the e-way bill and the other e-way bill had expired before the goods were intercepted. The authorities were therefore justified in applying the detention and penalty provisions, and the precedents relied on by the petitioner were distinguished as relating to an earlier period before the amendment.

Conclusion: The challenge to the penalty and appellate order failed, and the relief sought by the petitioner was rejected.

Ratio Decidendi: After the amendment making e-way bill compliance mandatory, transportation of goods without a valid e-way bill raises a rebuttable presumption of tax evasion, and subsequent production of documents will not by itself defeat detention and penalty under the GST law.

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