Facts of the case: The petitioner had exported textile machinery spare parts from New Delhi to Bangladesh via Ghaziabad. The goods were accompanied by valid tax invoices, a bilti (lorry receipt), and an e-way bill. However, the movement was halted and goods were sealed by the authorities on the grounds that Part-B of the e-way bill was not filled.

An order imposing a penalty was passed under Section 129. The Petitioner contended that the goods were being exported and had valid documentation. There was no intention to evade tax, as the goods eventually crossed the Indian border and reached Bangladesh, evidenced by customs seals.  The only allegation was non-filling of Part-B of the e-way bill, which is a mere procedural lapse and not a substantive contravention.

Reliance placed upon judgments in the case of M/s B.M. Computers v. Commissioner of Commercial Taxes and Fiserv Merchant Solutions Pvt. Ltd. v. State of U.P.

Issue: Whether non-filling of Part-B of the e-way bill during the export of goods amounts to tax evasion, justifying imposition of penalty under Section 129 of the CGST/SGST Act.

Held that: The Court observed that the goods were meant for export and indeed reached Bangladesh, as confirmed by customs seals.

Since the goods were exported and not diverted into the local market, no intent to evade tax  could be attributed. Non-filling of Part-B of the e-way bill was a technical breach, not justifying the imposition of penalty.

Accordingly, the Court quashed the penalty order dated 08.03.2019 and the appellate order dated 29.02.2020, and allowed the writ petition. The Court relied on precedents which had held that technical non-compliance without intent to evade tax cannot invite penalty.

M/s KARMIC INTERNATIONAL v. ADDITIONAL COMMISSIONER & ORS. Vide WRIT TAX No. 797 of 2020 dated 30.07.2025,

To read the complete judgment 2025 Taxo.online 1695