Satyam Shivam Papers (P.) Ltd. v. Assistant Commissioner of Service Tax – 2021 (50) G.S.T.L. 459 (High Court-Telangana)

No presumption can be drawn that there was an intention to evade tax on account of non-extension of the validity of the e-way bill. 

Facts: In this case, the Petitioner is a Company carrying on trading business in all kinds of paper. The Petitioner made an intra-state supply of paper and generated an e-way bill for the auto trolley and dispatched the goods. During the delivery of the paper, the roads were blocked due to a political rally opposing CAA and NRC conducted by certain political parties, and the traffic could not move forward or backward. The driver of the auto trolley waited till 08:30 p.m. on the road, and by that time, having realized that the shop of the buyer would be closed, the driver took the goods to his residence with a desire to deliver the goods on the next working day. Accordingly, an attempt was made by the driver but the trolley was detained by the Deputy State Tax Officer (the Respondent) and a Detention Notice in Form GST MOV-07 was served to the Petitioner alleging that the validity of the e-way bill had expired proposing to impose tax and penalty.

Subsequently, representations were made by the Petitioner to the Respondent for release of the detained goods by explaining about obstruction to the movement of the auto trolley, but the same was ignored and an order in Form GST MOV-09 was passed by the Senior Assistant on behalf of the Respondent for tax-evasion, levying the penalty and tax on the Petitioner. Accordingly, the Petitioner made the payment of INR 69,000/- after which the release order was issued by the Senior Assistant of the Respondent. Being aggrieved by the said order, this petition has been filed.

Issue: Whether the order passed for detaining the goods of the Petitioner due to the e-way bill expiry is correct. 

Held: The High court Telangana has held that, no presumption can be drawn that there was an intention to evade tax on account of non-extension of the validity of the e-way bill by the Petitioner or the auto trolley driver. Further. deprecated the conduct of the respondent in not adverting to the representations by the Petitioner, and deliberate intention to treat the validity of the expiry on the e-way bill as amounting to evasion of tax without any evidence of such evasion of tax by the Petitioner

It was held that there was no point in demanding the tax along with penalty merely on account of lapsing of time mentioned in E-way bill. The conclusion of the officer that there was evasion of tax by account of non-extension of validity of E-way bill by assessee or auto trolley driver was baseless with no material ground. Therefore, it was directed to the officer to refund the amount collected by using its power to the assessee.

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