TaxTMI 
TaxTMI 
2022 (9) TMI 91
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....nd Service Tax Act 2017 by M/s. Hero steel Ltd, Hero Nagar Sua Road, Giaspura, Ludhiana, Punjab GSTN-03AACC114638LIZK, (hereinafter also referred to Appellant) against the order no. EXN-ACSTE/BBN-BADDI/201-20/246 dated 08.07.2019 passed by the Assistant Commissioner State Taxes & Excise, Flying Squad Baddi, HP vide which an additional demand of Rs 5,84.766/-. has been created under section 129(3) of CGST/HPGST Act 2017 read with section 20 of IGST Act 2017 3. The said appeal has been acknowledged vide number 061/2019-20 dated 03.10.2019. The instant appeal case has been heard by the earlier Appellate Authority GST HP on dated 24.02.2020 and 07-08-2020. The appeal case was listed for argument on 23.07.2022 by me and the judgment was reserved. 4. Brief filets of the case are that on 01.07.2019 at around 3:00PM vehicle number PB11AX-7621 was intercepted for checking by Assistant Commissioner State Taxes & Excise Flying Squad Baddi, BBN, Distt, Solan (HP) along with his team. During the course of checking the person incharge of the vehicle produced tax invoice bearing number 91072637 dated 26.06.2019 issued by M/s Hero Steel Pvt. Ltd. Ludhiana having GSTIN Number 03AACCH4638LIZK. The....
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....ued to the consignor and consignee of goods through driver with the directions to appear before him on or before 01.07.2019 at 3PM and to show cause as to why penalty and tax may not be imposed for failure to comply with the provisions of Rule 138 of CGST Rules. 2017. It amounts to denial of any opportunity and any action taken on the basis of said notice is illegal and unsustainable. a. The inspecting officer has also erred in imposing tax and penalty U/s 129 of the CGST Act/HPGST Act read with section 20 of IGST Act, 2017 which is against the fundamental rules of natural justice as inspecting of officer cannot himself' be the deciding authority. b. That the impugned order passed by the officer is most arbitrary and illegal. The penalty has been imposed and tax has been levied without following the due procedure as contemplated under Section 20 of the IGST Act 2017 read with section 129 of CGST/HPGST Acts 2017 and also read with the instructions contained issued by Central Board of Indirect Taxes and Customs contained in Circular No. 41/18/2018 GST where the due procedure regarding interception of conveyance for inspection of goods in movement. detention. release, penalty et....
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....ax and penalty has also erred in determining the tax liability payable under the IGST Act 2017 at Rs. 2017 at Rs. 2,92,383 as well as penalty leviable U/s 20 of the IGST Act 2017 read with section 129 of the CGST/HPGST Act 2017 at Rs. 2,92,383/- i.e. total additional demand of Rs. 5,84,766/-. It is pertinent here to explain that appellant had already paid IGST amounting to Rs. 2,92,383/- on the said transaction. It amount to double payment of IGST. iv) That the proper officer has imposed the penalty and tax under IGST Act 2017 on the basis and its findings as recorded in its order as per the produced e-way bill, its validity had expired on 12.05.2019" which is absolutely wrong and baseless. Thus the penalty based on such finding is unsustainable. v) That the penalty imposed also cannot be sustained for the reason that the conveyance and goods reached the destination of the its PIN code i.e. factory premises in time i.e. 30th June 2019 which was Sunday and factory was closed, and goods could not be unloaded. The security Guard of the factory on duty asked the driver to come next day for unloading of goods. Before the goods could be unloaded the team of state GST official interce....
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.... bill had expired on 12.05.2019. The Ld. Advocate has submitted that the vehicle had reached its destination on 30.06.2019 well before the expiry of the e-way bill. On 30.06.2019 being Sunday the vehicle could not be unloaded. The Ld. Advocate has emphatically put across the point that no opportunity of being heard was afforded to the Appellant before the imposition of tax and penalty. So much so the notice was issued by the Proper Officer directing the supplier and recipient to appear on or before 01.07.2019 at 3:00PM as to explain their stand which is the same date and time of interception of vehicle by the Proper Officer. 12. The Respondent in their written and oral submissions has stated that the Appellant had violated the provisions of section 68 read with rule 138 as the e-way bill was found expired at the time of inspection of the vehicle and the tax and penalty has been rightly imposed under section 129. 13. In order to resolve the issue. it is necessary to understand the relevant provisions of GST Acts and Rules which govern the inspection of goods in movement, detention, seizure and release of goods and conveyances in transit. 14. Section 68 of HPGST/CGST Act 2017, whi....
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....ed without serving an order of detention or seizure on the person transporting the goods. (2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for detention and seizure of goods and conveyances. (3) The proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c). (4) No tax, interest or penalty shall be determined under sub-section (3) without giving the person concerned an opportunity of being heard. (5) On payment of amount referred in sub-section (1), all proceedings in respect of the notice specified in sub-section (3) shall be deemed to be concluded. (6) Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130 : Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the s....
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....release and confiscation of such goods and conveyances, as clarified in Circular Nos. 41/15/2018-GST dated 13.04.2018 and 49/23/2018-GST dated 21.06.2018 - regarding Kind attention is invited to Circular No. 41/15/2018-GST dated 13th April, 2018 as amended by Circular No. 49/23/2018-GST dated 21st June, 2018 vide which the procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances was specified. 2. Various representations have been received regarding imposition of penalty in case of minor discrepancies in the details mentioned in the e-way bill although there are no major lapses in the invoices accompanying the goods in movement. The matter has been examined. In order to clarify this issue and to ensure uniformity in the implementation of the provisions of the law across the field formations, the Board, in exercise of its powers conferred under section 168 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as 'the CGST Act') hereby clarifies the said issue hereunder. 3. Section 68 of the CGST Act read with&....
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....e condition that the error in the PIN code should not have the effect of increasing the validity period of the e-way bill; c) Error in the address of the consignee to the extent that the locality and other details of the consignee are correct; d) Error in one or two digits of the document number mentioned in the e-way bill; e) Error in 4 or 6 digit level of HSN where the first 2 digits of HSN are correct and the rate of tax mentioned is correct; f) Error in one or two digits/characters of the vehicle number. 6. In case of the above situations, penalty to the tune of Rs. 500/- each under section 125 of the CGST Act and the respective State GST Act should be imposed (Rs.1000/- under the IGST Act) in FORM GST DRC-07 for every consignment. A record of all such consignments where proceedings under section 129 of the CGST Act have not been invoked in view of the situations listed in paragraph 5 above shall be sent by the proper officer to his controlling officer on a weekly basis. 7. Difficulty, if any, in implementation of this Circular may please be brought to the notice of the Board. Hindi version would follow. 19. Thus, f....
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....o why penalty under the above stated sections should not be imposed. It is further mentioned in the order that the validity of the c-way bill had expired on 12/05/2019, whereas, the vehicle was detected on 01/07/2019. 23. It appears from the above that Proper Officer had passed the order without application of mind. The very fact that he is issuing notice on 01/07/2019 to appear on or before 01/07/2019 at 3.00PM i.e. the date on which the vehicle was intercepted and showing the date of validity of e-way bill as 12/05/2019 shows the carelessness, callousness and insensitivity while passing the orders. 24. Moreover in the impugned order there is not even a whisper nor in the body of the order which shows that the Appellant was liable to payment of tax and penalty despite the fact that IGST had already been paid on the transaction under question. The order is totally bereft of any reasoning. The Appellant has claimed that no proper opportunity to be heard was given to him as the notice issued by the Proper Officer to appear before him was on the same date and time. when the vehicle was intercepted. The Proper Officer has failed to make out a case that there was a willful and deliber....
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....missioner, within 24-hours of generation of the e-way bill; Provided that an e-way bill cannot be canceled if it has been verified in transit in accordance with the provisions of rule 138B. In the instant case the validity of the e-way bill has been extended as per the above rule. 29. It is stated in the order of the Proper Officer that the goods were physically examined and were found matching with the detail mentioned in the tax invoice. The goods were accompanied with proper tax invoice and GR. The Proper Officer has not mentioned anything regarding the evasion of tax by the Appellant. The vehicle was detained only for the reason that at the time of checking the e-way bill was there but the same was found beyond its validity period. 30. It is seen from the above facts that before the commencement of movement of goods the supplier had raised the tax invoice. The e-way bill was also generated prior the commencement of movement which contained the details of goods, tax invoice, as well as the buyer of the goods including his registration number under the GST Act. Once the tax invoice is issued and the e-way bill generated through online GST Portal containing all details regardin....