The Petitioner had hired a transporter for transporting goods and generated E-Way Bill for such transportation. However, due to the non-motorable condition of the vehicle, the goods could not be delivered on time. During inspection, the authorities found that the E-Way Bill had been expired before the time of inception. Accordingly, the vehicle was detained and demand was raised u/s 129 of the CGST Act. Aggrieved , the Petitioner filed a Special Civil Application before the Gujarat HC challenging the detention of the vehicle and the demand.
The HC observed that the Department could not establish any element of tax evasion with fraudulent intent or negligence on the part of the Petitioner. Further, the HC relied on the judgment in RE: Govind Tobacco Manufacturing Co [2022-VIL-347-ALH] wherein it had been held that the seizure of vehicle and the goods is not permissible under the law, if the EWay Bill expires on transit. Consequently, the detention order was quashed and set aside.
Govind Alloys Private Limited [TS-653-HC(GUJ)-2022-GST]
GLS Comments:
It would be pertinent to note that as a settled principle of law, coercive actions against assessees is not permissible in case of procedural lapses. The CBIC vide Circular No. 64/38/2018 - GST dated 14 September 2018, had clarified that proceedings u/s. 129 of the CGST Act shall not be initiated in case of specified lapses in E-Way Bills. While the circular does not specifically cover cases where the E-Way Bills have expired during transit, the Board's intention seems to be clear that invokation of penal provision u/s. 129 is unwarranted in case of minor lapses.
Disclaimer:
The information provided in this update is intended for informational purposes only and does not constitute legal opinion or advice. Readers are requested to seek formal legal advice prior to acting upon any of the information provided herein. This update is not intended to address the circumstances of any particular individual or corporate body. There can be no assurance that the judicial/ quasi judicial authorities may not take a position contrary to the views mentioned hereinrra quis.
Sign up for the Newsletter