Proceedings should follow Sections 73 & 74, not Section 130, even if excess stock is found

Facts of the case: In this case, a survey was conducted on petitioner led to the confiscation of goods and a penalty order for alleged excess stock. The Petitioner argued that survey was conducted under Section 67 of the UPGST Act, but proceedings should have been initiated under Sections 73 & 74 of the Act for excess stock. It was claimed that Section 35(3) prohibits proceedings under Section 130 against a registered dealer for such matters. Petitioner’s appeal was dismissed, leading to the current writ petition.

Held that: The Allahabad High Court in this case ruled that the penalty for excess stock should not have been imposed under Section 130 of the UPGST Act, but rather under Sections 73 & 74. The impugned order was set aside, and the writ petition was allowed, relieving the petitioner from the penalty. Relied upon previous judgments in the case of M/s Shree Om Steels and M/s Metenere Limited, wherein held that even if excess stock is found, proceedings should follow Sections 73 & 74, not Section 130.

To read the complete judgment 2024 taxo.online 1624