TaxTMI 
TaxTMI 
2026 (9) TMI 2061
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....der dated November 27, 2023, issued by Bharat Petroleum Corporation Ltd. (BPCL), Kochi, Kerala, the Appellant dispatched high-value loading/unloading arms. The consignment was accompanied by Tax Invoice No. W/23-24/418 dated March 27, 2024, explicitly disclosing the correct transport vehicle number (HR 38 Z 3057), delivery challans, and an active Part-A e-way bill. While in transit, the vehicle was intercepted on March 30, 2024, at NICE Road, Bengaluru, by Respondent No. 1. Although all primary transit and tax documents (including invoice and Part-A) were fully intact and undisputed, Part-B of the e-way bill was un-updated due to logistical miscommunication and portal realities. Without establishing any intention to evade tax, the intercepting authority detained the goods and issued an order under Section 129(3) in Form GST MOV-09 on April 2, 2024, levying a 100% penalty amounting to Rs. 17,02,620/-. The Appellant deposited this amount under protest via FORM GST DRC-03 and subsequently filed an appeal before the First Appellate Authority. The First Appellate Authority dismissed the appeal vide Order-in-Appeal No. GST.AP.85/24-25 dated June 14, 2024, prompting the present proc....
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....024] 159 taxmann.com 683 (All.)/ 2024:AHC:20378) Omission or delay in updating Part-B of the e-way bill due to logistical miscommunication or portal issues, when rectified subsequently, invalidates the levy of tax and penalty under Section 129. 3. VSL Alloys (India) Pvt. Ltd. v. State of U.P. (2018 (15) G.S.T.L. 683 (All.)/2018-VIL-196-ALH) Merely failing to mention vehicle numbers in Part-B of an e-way bill, when all other accompanying statutory documents are intact and genuine, cannot serve as a valid ground for detention or seizure. 4. RS Industrial Solutions v. Addl. Commr. (2019 (26) G.S.T.L. 38 (All.)) Non-filling of Part-B alone cannot attract Section 129 penalties without independent, recorded findings on an attempt to evade tax. 1. Reasoning of First Appellate Authority The first appellate authority concluded that without Part-B, an e-way bill lacks validity for movement, and dismissed the plea of technical glitches due to a lack of evidence or prior to communication with e-Governance portal. It emphasized that for a high-value consignment valued at over Rs. 50 lakhs traversing 1457 kilometers across three states, failing to generate Part-B befor....
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....x evasion. Establishes that procedural or technical tracking delays, in the absence of mens rea, do not equal tax evasion and cannot justify Section 129 penalties. 2. M/s Hemanth Motors v. State of Karnataka 2020 SCC OnLine Kar 4088 / (2021) 124 Taxmann 550 (Kar)) Held that where goods move under a valid tax invoice and reach their destination, technical tracking errors or minor procedural omissions fall under general administrative provisions, and not under Section 129. Supports the view that technical Part-B data omissions accompanied by a genuine invoice cannot be treated as clandestine tax evasion under Section 129. 3. M/s BVM Trans Solutions v. State of Karnataka NC 2025:KHC:47481 Reaffirmed that treating minor documentation or Part-B omissions as tax evasion is arbitrary, and that such technical portal errors fall under general penalty provisions like Section 125 rather than Section 129. Confirms that routine administrative portal or data-entry omissions are minor procedural errors, making heavy Section 129 penalties legally unsustainable. 4. M/s TAFE Limited v. Union of India State Quashed Section 129 orders where non-updation or technical....
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....ople actively trying to cheat the system, not businesses making an honest clerical mistake when the actual transaction is fully accounted for. 4. Higher courts have consistently established that procedural oversight must be judged through a lens of administrative reasonableness. As laid down by the Karnataka High Court in M/s Hemanth Motors ((2021) 124 Taxmann 550 (Kar)), where goods moved under a valid tax invoice and Part-A of the e-way bill and successfully reached their destination, technical tracking errors or minor procedural omissions must be evaluated using a reasonableness test, falling under general penalty provisions rather than triggering a harsh Section 129 penalty. 5. This is further reinforced by the Supreme Court in Assistant Commissioner (ST) v. M/s Satyam Shivam Papers Pvt. Ltd. ((2022) 149 taxmann.com 473 (S.C.)), where it was held that temporal or procedural transit glitches do not automatically raise a presumption of tax evasion or justify heavy penalties without proof of a guilty mind (mens rea). Similarly, the jurisprudence developed under the GST era-exemplified by rulings such as RS Industrial Solutions v. Addl. Commr. [2019 (26) G.S.T.L. 38 (All.)], ....