TaxTMI 
TaxTMI 
2023 (10) TMI 635
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...."SAIL"). The petitioner placed an order with SAIL, the goods were transported from West Bengal to Kanpur through railway in the wagon against invoices and other documents required under the Act. The wagon was unloaded and taken into custody by the petitioner for further transportation of good to Bazpur. For that purpose two vehicles were deployed bearing registration nos. HP 939081 and UP 25 BT 6528 ("the vehicles"). Accordingly, e- way bill was also generated and goods were moved towards its destination on 04.06.2023. When the vehicles were intercepted by the respondent no. 3, it was found that the vehicles were not carrying the delivery challans as required under Rule 55 (5) (b) of the Central/State Goods and Services Rules, 2017("the 2017 Rules"). After completing the procedure as required under the Act and Rules, by the impugned order, separate penalty has been imposed with regard to the each of the vehicles engaged in transportation. In these petitions, those two orders dated 09.06.2023 have been challenged. The petitioner also seeks refund of the amount which was deposited on 10.06.2023 pursuant to the impugned orders dated 09.06.2023. 4. It is the case of the petitioner t....
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...., whatsoever. Learned counsel would refer to provisions of Section 126 of the Act to argue that in the instant case, the penalty has been much disproportionate; it was an error which was rectifiable. Learned counsel would also raise the following points in his submission:- (i) According to the principle of interpretation, a statutory provision should not be read in the manner that it may tend to make any other provision of the statute as redundant; the provision of the statute should be read so as to give life to each of the provisions contained in the statute; there should be harmonious interpretation of the statutory provisions. (ii) Essentially, the taxing statute ensures that there is no leakage in the tax; it avoids loss to exchequer, as also it protects the interest of honest tax payer, and also takes care of those, who defaults in the payment of tax. Referring to Circular No. 64/38/2018/GST of the Government of India, it is argued that in case of non-compliance of the provisions with regard to generation of e-way bill, necessarily the provision of Section 129 of the Act may be invoked, but not in case of minor infraction. (iii) In the instant case,....
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.... the weigh bridge, while it was intercepted. Under those facts and circumstance, the Hon'ble High Court of Madhya Pradesh observed that "there was no element of tax evasion, fraudulent intent and negligence". 14. In the case of Smart Roofing Pvt. Ltd. (supra), the proceeding under Section 129 of the Act were challenged. It was the case of the petitioner in that case that he had no intention to evade tax as he had already generated the e-way bill by declaring the consignee etc. The Hon'ble Madras High Court held that "no doubt, the authorities acting under the Act were justified in detaining the good inasmuch as there is a wrong declaration in the E-way bill. However, the facts indicate that the consignor and the consignee are one and the same entity, namely, Head Office and the Branch Office." The Hon'ble Court further observed that "in that case, there is only a technical breach committed by the petitioner and there is no intention to evade tax accordingly." The principles of law, as laid down in the case of Smart Roofing Pvt. Ltd. (supra) were followed in the case of Algae Labs Private Limited (supra). 15. In the case of Varun Beverages (supra), there was an error in the ve....
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.... (2) The details of documents required to be carried under sub-section (1) shall be validated in such manner as may be prescribed. (3) Where any conveyance referred to in sub- section (1) is intercepted by the proper officer at any place, he may require the person in charge of the said conveyance to produce the documents prescribed under the said sub-section and devices for verification, and the said person shall be liable to produce the documents and devices and also allow the inspection of goods." 19. Section 122 of the Act is in Chapter XIX of the Act, which deals with offences and penalty. It reads as follows:- "122. Penalty for certain offences.- (1) Where a taxable person who-- (i) supplies any goods or services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply; (ii) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act or the rules made thereunder; ......................................................................... ......................................................................... .........
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....procedure under which the amount of penalty for the breach has been specified. (5) When a person voluntarily discloses to an officer under this Act the circumstances of a breach of the tax law, regulation or procedural requirement prior to the discovery of the breach by the officer under this Act, the proper officer may consider this fact as a mitigating factor when quantifying a penalty for that person. (6) The provisions of this section shall not apply in such cases where the penalty specified under this Act is either a fixed sum or expressed as a fixed percentage." 21. Section 129 of the Act provides for procedure in case of detention, seizure and release of goods and conveyances in transit. It reads as follows:- "129. Detention, seizure and release of goods and conveyances in transit.- (1) Notwithstanding anything contained in this Act, where any person transports any goods or stores any goods while they are in transit in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the said goods and documents relating to such goods and conveyance shall be liable t....
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....per cent. of the value of the goods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent of the value of goods or twenty five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty; (c).................................................................. ............................................................................... ........................................................." 23. There is another Section which deals with violation of the Rules. It is Section 164 of the Act, which reads as follows:- "164. Power of Government to make rules.- (1) The Government may, on the recommendations of the Council, by notification, make rules for carrying out the provisions of this Act. (2) Without prejudice to the generality of the provisions of sub-section (1), the Government may make rules for all or any of the matters which by this Act are required to be, or may be, prescribed or in respect of which provisions are to be or may be made by rules. (3) The power to make rules conferred by this sec....
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....................................................." 26. It is not in dispute that at the time of interception on 04.06.2023 the in-charge vehicles were not carrying delivery challan as required under Section 55 (5) of the 2017 Rules. The goods were transported from Kolkata to Kanpur in one wagon and thereafter, they were taken separately in two trucks. This requirement is not in dispute. What is being argued is that it is not such a case which may invoke the provisions of Section 129 of the Act. 27. In fact, learned counsel for the petitioner would refer to Rule 138 A of the 2017 Rules to argue that sub-Rule (1) of sub-Clause (A) of 138 A makes it clear that invoice may be replaced by bill of supply or the delivery challan, as the case may be. This proposition, by mere reading of Rule 138 A sub-Rule (1) (a), may not be doubted. 28. Reference has also been made to Rule 55 sub-Rule (3) which has already been quoted hereinabove. According to which, when the goods are transported on the delivery challan in lieu of invoice, it needs to be declared as specified in Rule 138. This has been referred to indicate that both invoice and delivery challan may be interchangeable. It is als....
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.... aspect of them, entry into a temple for worship, the rights declared under Article 25(2)(b) will prevail. While, in the former case, Article 25(2)(b) will be put wholly out of operation, in the latter, effect can be given to both that provision and Article 26(b). We must accordingly hold that Article 26(b) must be read subject to Article 25(2)(b)." 34. The rule of harmonious construction of any statute requires that statutory provision should be so interpreted that they may not come in conflict with any provision. It should harmonised to the best extent possible. In the case of Managing Director, Chattisgarh Co-operative Bank Maryadit Vs. Zila Sahkari Kendriya Bank Maryadit and Others, (2020) 6 SCC 411, the Hon'ble Supreme Court on this aspect observed as hereunder:- "33. It is a settled principle of law that where two provisions of an enactment appear to conflict, courts must adopt an interpretation which harmonises, to the best extent possible, both provisions. Justice G.P. Singh in his seminal work Principles of Statutory Interpretation states: "To harmonise is not to destroy. A familiar approach in all such cases is to find out which of the two apparently ....
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....o evade payment of tax; or ............................................................................... .................................................................................... ................................................................................" 37. A bare reading of Section 130 of the Act, makes it clear that here what is to be established that (i) there has been non-compliance of the provisions of the Act, which leads to the evasion of the Tax and further the evasion of tax was intentional. 38. Under Section 129 of the Act, there was no factor like intention. It is mere non-compliance. But as stated, prior to amendment which came into force on 01.01.2022 as per Section 129 sub-Section (1) sub-Clause (a), "the vehicle could have been released on payment of applicable tax", which this Court had already discussed. It makes it abundantly clear that initially when Section 129 of the Act was enacted, the legislature had considered that there was some tax element, which was to be addressed before the release of the vehicle. Section 122 of the Act, on the other hand, is simpliciter. Section 122 (xiv) of the Act makes one liable....