Mere delay in producing E-Way Bill doesn’t call for penalty

Facts: In this case, the goods of assessee were seized while being imported on the ground that E-Way Bill was not found with goods although they were being imported against regular tax invoice.  Consequently, the penalty proceedings were initiated. However, in the said case assessee had downloaded E-way bill from the website and produced the same with some delay but before conclusion of the penalty proceedings. and moreover there is no allegation of evasion of tax liability as there was some technical error in downloading the E-Way Bill.

Hence the penalty order and seizure order cannot be sustained and are hereby quashed.

Issue: Whether penalty order passed is sustainable, in case there was no allegation of evasion of tax liability established either from show cause notice or seizure order or consequential penalty order. 

Held: The High Court observed that in the present case there is no allegation of evasion of tax liability established either from the reading of the show cause notice or the seizure order or the penalty order the consequential penalty imposed appear to have been occasioned upon a mere technical breach and not on account of any intention to evade tax.

It is also not disputed that being faced at present there are certain difficulties with regard to the downloading of the E-Way Bill and also certain doubts still remain with regard to the requirement and submission of E-Way Bill.