GST goods detention penalty u/s129(1)(b) challenged in writ; petition dismissed, directed to file s.107 appeal.

The dominant issue was whether a writ petition challenging a penalty under s.129(1)(b) of the WBGST/CGST Act, 2017 was maintainable despite an alternative appellate remedy. The HC held that the alternative remedy bar was not displaced because there was no breach of natural justice (hearing granted and a reasoned order passed), no lack of jurisdiction, no vires challenge, and no substantiated fundamental rights infringement; the impugned order involved detailed factual findings unsuitable for writ adjudication on affidavits. Consequently, the petition was not entertained on merits and the petitioner was relegated to the statutory appeal under s.107, with liberty to raise all points; the tax authority was directed to provide login credentials to facilitate filing the appeal.

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1. ISSUES PRESENTED AND CONSIDERED

(i) Whether the writ petition should be entertained despite the statutory appellate remedy, and whether the case fell within recognised exceptions to the rule of relegating parties to appeal.

(ii) Whether, on the Court's scrutiny of the impugned detention/penalty order, the dispute primarily involved disputed factual findings (including alleged fraud and document veracity) unsuitable for adjudication in writ jurisdiction.

(iii) Whether the departmental circular on "deemed owner" could be relied upon to claim the benefit of Section 129(1)(a) where the authority had raised serious doubts about genuineness/veracity of the underlying documents.

(iv) Whether interim release of perishable goods and conveyance should be directed pending appeal, and on what financial terms.

2. ISSUE-WISE DETAILED ANALYSIS

(i) Entertainability of writ petition despite alternative remedy

Legal framework (as discussed by the Court): The Court reiterated that an alternative statutory remedy does not bar writ jurisdiction only in exceptional situations such as violation of natural justice, challenge to vires, infringement of fundamental rights, or lack of jurisdiction.

Interpretation and reasoning: The Court examined whether any exception applied. It found that the petitioner had been afforded opportunity of hearing and a reasoned order had been passed; there was no challenge to vires, no plausible case of fundamental rights violation, and no case of the authority acting wholly without jurisdiction. The grievance essentially concerned the correctness/legality of applying Section 129(1)(b) instead of Section 129(1)(a), which the Court treated as, at best, an "error within jurisdiction" to be corrected in appeal.

Conclusion: The writ petition was not entertained on merits; the petitioner was relegated to the appellate authority under Section 107.

(ii) Whether the impugned order involved disputed facts (including fraud/document veracity) unsuitable for writ adjudication

Legal framework (as discussed by the Court): The Court emphasised limits of writ jurisdiction where adjudication would require "comprehensive factual exercise" not possible on affidavit evidence.

Interpretation and reasoning: On perusal, the Court found the impugned order to be detailed and founded on multiple factual findings, including inference of fraud and manipulation of the transaction documents (not merely a route deviation). The authority relied on factors such as timing and continuity of two e-way bills, distance/time improbability, and corroborative material (including RFID toll data and a weighment slip) to conclude that loading occurred in West Bengal rather than the declared place, that the purported consignor was not the actual consignor, and that no owner had come forward-leading to penalty under Section 129(1)(b). The Court held that testing the worth of these findings required factual assessment best left to the statutory appellate forum.

Conclusion: Because the dispute turned on contested factual findings and allegations of fraud, the Court declined to undertake merits review under Article 226 and directed the petitioner to pursue statutory appeal.

(iii) Applicability of the "deemed owner" circular to claim benefit of Section 129(1)(a)

Legal framework (as discussed by the Court): The Court accepted that the circular issued by the Board is binding on the department and its officers, but held that such circulars operate only "within the confines of the statute" and cannot override statutory scrutiny.

Interpretation and reasoning: The Court construed the circular as promoting a balanced approach where technical errors/minor deviations should not lead to hefty penalties; however, it expressly limited its application to cases where the documents referred to in the circular are "in order." The Court held the circular cannot serve as a "passport to bypass strict legal scrutiny" in matters involving undisclosed transactions and/or dubious invoices and bills. Since the impugned order raised serious questions about the veracity of the petitioner's documents (including e-way bills), the Court concluded that the circular could not be relied on to secure the benefit of Section 129(1)(a) at the writ stage.

Conclusion: The petitioner was not granted the circular-based "deemed owner" benefit for Section 129(1)(a) in the face of serious doubts about document genuineness; the issue was left to be examined in appeal.

(iv) Direction for release of perishable goods and conveyance pending appeal, and conditions imposed

Legal framework (as applied by the Court): While declining merits adjudication, the Court considered interim protection in view of perishability and fashioned conditional release linked to Section 129 penalty structure.

Interpretation and reasoning: Accepting the submission that the goods were perishable with limited shelf life, the Court ordered release on conditions balancing revenue protection and preventing deterioration. It directed that the petitioner pay an amount equivalent to the penalty that would have been payable under Section 129(1)(a) and secure the remaining differential (between the penalty imposed under Section 129(1)(b) and the amount paid under Section 129(1)(a)) by furnishing a bank guarantee in favour of the GST authority.

Conclusions: Upon such payment and bank guarantee, the authorities were directed to release the goods and conveyance within three working days. The Court clarified it had not examined merits and left all points open for the appellate authority, directing facilitation for filing appeal (GST ID/password) and requiring disposal of the appeal within four weeks of filing.

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