Facts of the Case:

In this case, the petitioner acting as consignor had supplied and transported goods. During transit, the truck carrying the goods was intercepted by the CGST authorities, resulting in detention of both the consignment and the conveyance. Thereafter, the authorities issued a show cause notice under Section 129(3) of the CGST Act read with Section 20 of the IGST Act alleging contravention in transportation of goods. The demand notice reflected separate liabilities under Section 129(1)(a) and Section 129(1)(b) of the CGST Act. Aggrieved by continued detention of the goods and conveyance, the petitioner approached the High Court seeking release of the consignment.

During the proceedings, the petitioner relied upon an earlier judgment of the Court in Ranjeet Kumar Poddar v. Assistant Commissioner of CGST & CX, decided on 14.05.2026, wherein in similar circumstances release of detained goods had been permitted upon compliance with Section 129(1)(a) of the CGST Act. The revenue also admitted that no appeal had yet been filed against the said judgment.

Issue:

Whether the detained consignment could be released upon compliance with Section 129(1)(a) of the CGST Act, particularly when the department had failed to place any prima facie concrete or unimpeachable material to establish that the petitioner was not the owner of the goods. Whether release of the goods could be denied unless the conveyance owner separately complied with payment obligations relating to the vehicle.

Held That:

The High Court observed that the goods involved were perishable in nature and that the revenue authorities had failed to produce any convincing or reliable evidence indicating that the petitioner was not the owner of the detained consignment. The Court further noted that even the detention order and demand proceedings did not disclose any prima facie material disentitling the petitioner from seeking release of the goods as owner of the consignment.

Relying upon its earlier decision in Ranjeet Kumar Poddar, the Court held that the petitioner was entitled to release of the consignment upon compliance with Section 129(1)(a) of the CGST Act. Accordingly, the Court directed that upon deposit of the amount required under Section 129(1)(a), the detained consignment should be released within three clear days from the date of such deposit.

The Court further clarified that even if the conveyance owner did not make payment towards the liability relating to the vehicle, the consignment itself could not continue to be detained once the petitioner complied with the statutory requirement under Section 129(1)(a).

Case Name: M/s Raja Supari Processing Unit Versus Union of India and Anr. dated 18.05.2026

To read the complete judgement 2026 Taxo.online 1345