Facts of the Case:

In this case, while the goods were in transit, the vehicle was intercepted by State Tax authorities in Gujarat. Despite the driver possessing all requisite documents including tax invoice and valid e-way bill, the goods were detained on the ground that the e-way bill was generated for a different destination. Proceedings under Section 129 of the CGST Act were initiated and a notice in Form GST MOV-07 was issued proposing tax and penalty. The petitioner submitted detailed objections and sought release of goods. However, the goods were released only upon payment of the demanded amount. Subsequently, the adjudicating authority passed an order in Form GST MOV-09 confirming the demand without considering the petitioner’s objections and without granting personal hearing.

Issue:

Whether an order passed under Section 129(3) of the CGST Act without considering the taxpayer’s objections and without granting an opportunity of personal hearing is sustainable in law?

Held That:

The Court observed that although the petitioner had filed objections prior to passing of the order, the same were not considered by the adjudicating authority. Further, no opportunity of personal hearing was granted as mandated under Section 75(4) of the CGST Act. The authority had mechanically passed the order merely on the basis that the petitioner had paid the tax and penalty for release of goods, without recording any independent findings or reasons.

The Court emphasized that consideration of objections and grant of hearing are fundamental requirements before passing an adverse order. Accordingly, the impugned order was quashed and the matter was remanded for fresh adjudication with a direction to provide adequate opportunity of hearing and to pass a reasoned order in accordance with law.

Case Name: DSP Metalliks Proprietor Yashwant Fatehlal Jain Versus State Of Gujarat & Anr. dated 06.04.2026

To read the complete judgement 2026 Taxo.online 876