Confiscation order under Section 130 CGST Act set aside for violating mandatory procedural requirements and hearing opportunity

The Uttarakhand HC set aside a confiscation order and penalty imposed under Section 130 of the CGST Act, 2017, finding the proceedings violated mandatory procedural requirements. The entire process-show-cause notice, reply, and confiscation order-was completed on the same day without providing the petitioner an opportunity to be heard, contravening sub-section (4) of Section 130. The Court deemed this arbitrary and contrary to statutory provisions. The matter was remitted to the Competent Authority to restart proceedings from the show-cause notice stage, ensuring proper opportunity for hearing.

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The Uttarakhand High Court, per Chief Justice G. Narendar, addressed the petitioner's challenge to the confiscation of goods and imposition of fine and penalty under Section 130 of the CGST Act, 2017. The Court noted that the entire process-including issuance of the show-cause notice, reply by the vehicle driver (unconnected to the goods), and passing of the confiscation order-was completed on the same day without affording the petitioner an opportunity of being heard. This procedure violated sub-section (4) of Section 130, which mandates that "No order for confiscation of goods or conveyance or for imposition of penalty shall be issued without giving the person an opportunity of being heard." Consequently, the Court held the action "not merely arbitrary, but... in the teeth of the provisions" and set aside the confiscation and penalty order. The matter was remitted to the Competent Authority to redo the proceedings from the issuance of the show-cause notice stage. The writ petition was allowed with no order as to costs.

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