Penalty not sustainable on the ground that transporter not carrying original tax invoice while transporting the consignment

Facts of the Case:- In this case, Petitioner was transporting bitumen for subsequent sale. When the container was transporting the consignment, the respondent-Enforcement of officer of the Commercial Tax intercepted and inspected the vehicle. It is stated that the Original Tax Invoice was not carried in the vehicle and therefore, the petitioner is liable for penalty. Accordingly, the Enforcement passed the order dated 18.09.2021 determining the tax and penalty.

Petitioner's Contention:- The Petitioner contended that every supplier is required to upload the Invoices in the official portal and officials attached to the respondents could have downloaded the said Invoice. As per Rule 48 of the CGST, the Invoice is required to be prepared in triplicate in case of supply of goods and copy marked as Original is meant for recipient or purchaser of the consignment and therefore, same will be directly sent to the purchaser. The duplicate copy is meant to be carried by the transporter and the third copy marked as triplicate is meant for supplier to be retained with him. This Rule makes it clear that it is only the duplicate copy which is to be carried by the transporter during transit. The only objection raised by the respondents is that the transporter was not carrying the Original Tax Invoice, which is not the requirement of law.

Department's Contention:- The respondent department submitted that they have referred to Rule 138-A of the SGST and Section 68 of the CGST, according to which the persons in charge of conveyance is required to be carried the Invoice or Bill of delivery challan with him along with other documents. Since the appellant was not carrying the Original Tax Invoice, the tax and penalty was imposed and there is no illegality in the order.

Held:- The High Court noted that Rule 48 of the CGST, deals with the manner of issuing the Invoice. Accordingly, to which the Invoice shall be prepared in triplicate in case of supply of goods. The original copy marked as such is meant for recipient or the purchaser and therefore, same will not be carried by transporter. As per Section 48(1)(b) of the CGST, it is only the duplicate copy is meant for transporter and the triplicate copy is for the supplier as per clause-C. 

Therefore, it is clear that the transporter is not required to carry Original Tax Invoice but law mandates him to carry the duplicate copy. Under such circumstances, the contention taken by the respondents that the petitioner is liable for tax and penalty as the transporter had not carried Original Tax Invoice cannot be accepted. It is stated that the petitioner is levied with double tax as he has already paid the tax as required to be paid and once again he paid the tax with penalty and therefore, same is liable to be refunded. 

The Court accordingly, directed to refund of the tax paid in excess and the penalty to the petitioner within three months.

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