2017 Taxo.online 48
WRIT TAX No. – 729 of 2017 dated 14.11.2017
Iqra Roadways (India) & 3 Ors.
State Of U.P. & 3 Ors.
Central Goods & Services Tax Act, 2017
Section 129 of CGST
Abhinava Upadhya, Justice & Ashok Kumar, Justice
In favour of assessee
Seizure of Goods – Release of Goods on deposit – Detention and seizure of goods made even after accompanying with Tax Invoices, Bilty as well as E-Way Bill except against two invoices where value of consignment is below Rs. 50,000 – Petitioners submitted that even the vehicle is seized – Respondent mentioned in the Detention Memo that physical verification was required as E-way Bill produced was not relevant as the date and time mentioned already expired – Held: – The Court finds that since the factual disputed issues are involved and penalty proceedings are already initiated by Respondents, therefore, in the interest of justice that the seized goods be released in favour of the petitioners on the payment of an amount of ₹ 1,11,564 – Court have been informed that an huge amount of more than ₹ 6 lacs has been fixed/demanded against the petitioners which in our opinion is highly excessive and the order of penalty is appealable before the First Appellate Authority – Petitioners may approach the appellate authority and file an appeal against the penalty order. The appellate authority directed not to insist for deposit of any penalty amount for hearing and admission of the appeal.
Represented by: –
Petitioner: – Sanyukta Singh & Shubham Agrawal
Respondent: – C.S.C., A.S.G.I. & Ajay Kumar Singh
Heard Shri Shubham Agrawal assisted by Miss Sanyukta Singh, learned counsel for the petitioners and Shri C.B. Tripathi, learned Special Counsel representing the respondents.
By means of the present writ petition the petitioners have sought the following relief :
“(a) Issue a Writ, Order or Direction in the nature of Certiorari quashing the seizure order dated 25.9.2017 (Annexure No. 1 to the writ petition) as well as the consequential notice dated 26.9.2017 (Annexure No. 2 to the writ petition) issued by the respondent no. 4.
(a-2) Issue a writ, order or direction in the nature of certiorari quashing the penalty order dated 26.10.17 (Annexure CA-10) not served upon the petitioner.
(b) Issue a Writ, Order or Direction in the nature of Mandamus commanding/directing the respondent no. 4 to release the goods and vehicle forthwith without demanding any security.
(c) Issue any other Writ, Order or Direction in favour of the petitioner which this Hon’ble Court deems fit in the facts and circumstances of the case.
(d) Award cost of the petition to the petitioner.”
The brief facts of the case are that the petitioner no. 1 and 4 being the transporters indulge in carrying on the business of transportation of goods from one place to another. The petitioner no. 2 and 3 are the buyers/purchasers and are registered under the Goods and Services Tax Act/Rules, 2017. The petitioner no. 2 and 3 have affected certain purchases from different sellers situated at Delhi. According to petitioners no. 2 and 3 since they are duly registered under the Central Goods and Services Tax Act, 2017 (C.G.S.T. ACT) and the goods which are purchased by them are duly accompanying with the requisite Tax Invoices, Bilty as well as E-Way Bill, therefore, the action of the respondent authorities in detaining and seizing the goods under Section 129(1) of the U.P. Goods and Services Tax Act, 2017 vide order dated 25.9.2017 is bad. Learned counsel for the petitioners has submitted that even the vehicle has also been seized by the respondent no. 4 after detention of the goods and, therefore, the entire action of the respondent authorities is wholly illegal, arbitrary as well as without jurisdiction.
Learned counsel for the petitioner has further submitted that the goods in question are duly accompanying the Tax Invoices, Bilty and value of consignment, except against two invoices, is below Rs. 50,000/-, therefore, there was no justification on the part of the respondent no. 4 to seize the same. He has further submitted that the respondent no. 4 was not authorized to seize the goods as the goods were covered under the provisions of Integrated Goods and Services Tax Act, 2017 (I.G.S.T. Act). He has further submitted that since the goods accompanying the documents were in transportation in the course of interstate trade, therefore, respondent no. 4, being the authority under the U.P. Goods and Services Tax is not competent to seize the goods.
Learned counsel for the petitioners heavily relied upon Circular No. 1117 dated 16.8.2017, in which it has been provided that the G.S.T. being the new law, therefore, it may take some time for proper implementation of the scheme of E-Way Bill on all India basis. Learned counsel for the petitioner has placed the provision of Rule 138 of U.P. G.S.T. Rules which provides for the old E-Way Bill scheme, which was in effect earlier, may be continued.
We have gone through the contents of the aforesaid circular and after hearing the parties at length we find that certain factual disputes are involved in the present case. At the time of detention, the detaining authority has clearly mentioned in the detention memo that the necessary physical verification is required as the E-Way Bill, which was produced, was not relevant as the date and time mentioned have already expired. We find that on physical verification, the authority has found certain irregularities with regard to quality of the goods as well as quantity. It is further noticed that the goods which were covered with the documents have already been released by the respondent no. 4. However, the goods which were not accompanied with proper documents have been seized for which a notice under Section 129(3) of the U.P. G.S.T. Act has been issued on 26.9.2017 indicating therein the value of the goods and the demanded tax which has been calculated by the seizing authority at different rates as per the individual items/goods which is mentioned being Rs. 1,11,564/-.
Against the said proceedings the present writ petition has been filed. After hearing the parties at great length and after perusal of the documents we find that in the instant case since the factual disputed issues are involved and further that the penalty proceedings are already initiated, as intimated by the counsel for the State, therefore, it would be proper in the interest of justice that the seized goods be released in favour of the petitioners on the payment of an amount of Rs. 1,11,564/- (as indicated in the show cause notice dated 26.9.2017). We have informed that in the penalty order an huge amount of more than Rs. 6 lacs has been fixed/demanded against the petitioners which in our opinion is prima facie appears to be highly excessive and since the order of penalty is appealable before the First Appellate Authority, it would be in the interest of justice that the petitioners may approach the appellate authority and file an appeal against the penalty order and in case, if the appeal is filed by the petitioners before the appellate authority, the appellate authority is directed to decide the same within a period of two months from the date of the presentation of the appeal. The appellate authority is directed not to insist for deposit of any penalty amount for hearing and admission of the appeal.
In view of the aforesaid, it is hereby directed that the goods and vehicle be released forthwith on payment of the amount of tax as has been indicated in the show cause notice dated 26.9.2017 being Rs. 1,11,564/-. It is made clear that any observation of this order will not affect any of the proceedings which is to be carried out by the respondents.
The writ petition is, accordingly, dismissed.