GST detention under section 129: disputed ownership does not bar release on payment of the prescribed penalty.

Goods detained in transit under GST may be released under section 129 where the claimant comes forward as owner and pays the prescribed penalty, and a dispute over ownership, quantity, or supporting documents does not by itself justify continued detention. The Calcutta HC treated section 129 as the statutory release mechanism and held that, on the materials described, no unimpeachable evidence showed that the petitioner was not the owner. The pending challenge to the documents and tax demand was left to the regular appellate process, while the revenue retained liberty to recover any confirmed demand in accordance with law.

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Issues: Whether the detained consignment was entitled to release on payment under section 129(1)(a) despite the revenue's dispute regarding ownership, quantity, and supporting documents.

Analysis: The detention arose during transit under the GST regime, and section 129 provides the statutory mechanism for release of goods and conveyance upon payment of the prescribed penalty. The Court read the provision strictly and held that it contemplates release either where the owner comes forward under clause (a) or where the owner does not come forward under clause (b). On the facts, the show-cause notice described the petitioner as consignor and the consignee was identified, while no concrete material was shown to establish that the petitioner was not the owner. Since the dispute over ownership and the validity of the documents was to be resolved in the pending appellate process, that dispute did not prevent release at the detention stage. The Court also noted that if the eventual demand is confirmed, the revenue may proceed in accordance with law for recovery.

Conclusion: The detained consignment was held releasable in favour of the petitioner on compliance with section 129(1)(a) of the Central Goods and Services Tax Act, 2017.

Ratio Decidendi: Where goods detained in transit fall within section 129 and no unimpeachable material establishes that the claimant is not the owner, the goods must be released on compliance with the statutory penalty prescribed for release, leaving adjudication of the tax demand to the regular appellate and recovery process.

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