No Detention under Section 129, if the assessee is acting bonafide.
Facts of the Case: –
- The Vehicle of the respondent/writ petitioner was intercepted by the department on 9th of September 2019 on the ground that the E-way bill expired on 8th September 2019 and the goods were being transported on 9th September.
- It was the case of the appellant that the writ court allowed the writ petition and ordered for refund of tax and penalty paid by the respondent/writ petitioner under protest, considering the submissions made by the respondent/writ petitioner that ‘the delay was on account of breakdown of the vehicle transporting the goods however, there was no willful intention to evade payment of tax.
Appellant’s Submissions: –
- It is submitted on the behalf of the Appellant that the respondent/writ petitioner never stated anything about the breakdown of vehicle before the appellate authority and in the pleadings of the Writ Petition.
- The learned Single Bench ought not to have allowed the writ petition by accepting the argument, as it was taken for the first time when the writ petition was filed before the Court.
- Further, relying on the findings of the appellate authority, submitted that the learned Writ Court should not have interfered with the order of demand of tax and penalty.
Respondent’s/Writ Petitioner’s Submissions: –
- It was submitted on the behalf of the respondents that the bona fides of writ petitioner have to considered, taking note of which, the learned writ court granted relief.
- That to show the bonafide the documents which formed part of record of the writ court were referred, especially, the tax invoice raised by M/s. Bhaskar Steel and Ferro Alloy Private Limited dated 7th September, 2019 and the e-way bill dated 7th September, 2019, which was valid upto midnight of 9th September, 2019 mentioning details of despatch from SRMB Srijan Private Limited to Shubham Steels (Writ petitioner having its registered office in Kolkata).
- Further the respondent raised a tax invoice in favour of Om Dayal Educational and Research Society (having registered office in Kolkata), however the goods had to be delivered as per the instructions of the purchaser at Delhi Public School, Sector – 2D, Bidhannagar, Durgapur. That with respect to this transaction, the respondent/writ petitioner raised a second E-way bill dated 7th September 2019, which was valid upto 8th September 2019 and mention of the same vehicle/vehicle number.
- The Hon’ble Court after considering the submissions from the both sides & facts of the case, found that there is no dispute as to the quantity and the description of goods. Further the vendor (Bhaskar Steel and Ferro Alloy Pvt. Ltd.) raised a tax invoice dated 7th September 2019 as well as the E-way bill dated 7th September 2019 for transportation of goods from SRMB Srijan Pvt. Ltd. to the writ petitioner.
- It was observed that the said E-way bill dated 7th September 2019 was valid upto 9th September 2019, as the approximate distance was about 168 Kms.
- It was the case of the writ petitioner that they had a supply order from Om Dayal Educational and Research Society (having its registered office in Kolkata), however the goods had to be shifter to a place in Durgapur.
- Accordingly, a Second E-Way bill on 7th September 2019 was raised, as the distance from SRMB Srijan Pvt. Ltd., Durgapur to Delhi Public School was only 9 Kms, the said E-way bill was valid till 8th September 2019(midnight).
- Thereafter, the Hon’ble Court without going into the controversy regarding breakdown of vehicle found that the case has to be observed on the basis of bona fides of the transaction.
- It was found when the first E-way bill expiring on 9th September 2019 was available, therefore, in the absence of second E-way bill, the authorities could not have intercepted or detained the vehicle.
- The Hon’ble Court accepting the explanation put forth by the writ petitioner held there was no case of deliberate and willful attempt to evade payment of tax on the part of the respondent/writ petitioner, so as to initiate proceedings under Section 129 of the Act. Thus, we are of the view that the relief granted by the learned writ Court is fully justified.
The Hon’ble Court with the above findings, dismissed the appeal and the application filed by the department and directed the department/appellant to process the refund application for refund filed by the respondent on 7th March 2022 in terms of the order of the learned Writ Court. It was made clear by the Hon’ble Court that the decision having been rendered on the peculiar facts cannot be treated as a precedent