Section 130 invoked after tax, interest and penalty paid under section 74a

[Diksha Sabarwal]

Hi Experts,

Assessee paid taxation, interest and penalty(100c/o) under section 74A and the seized goods were released after payment on valuations approved by GST Department DGGI. Now next day after the release SCN was raised and confiscation was asked under section 130 and asking to pay penalty under section 122 for non recording of books. Just to heads up, no clandestine sales were found and only excess stock was found on which the liability was discharged under section 74A.

Please share your opinion on the same matter And if possible some relevant case laws so that department view can be challenged.

AI Summary

Excess stock confiscation requires independent evidence of tax evasion where liability has already been discharged and goods released.
GST confiscation proceedings under Section 130 may be challenged where excess or unaccounted stock has already been investigated, valued, subjected to tax, interest and penalty under Section 74A, and released. Mere excess stock is insufficient by itself to support confiscation, and an alleged intent to evade tax requires supporting evidence. A subsequent confiscation notice requires an independent statutory basis where no fresh material has emerged. Any additional penalty for non-recording of stock must identify the precise contravention and supporting evidence.