The Hon’ble High Court of Madras vide its order dated 14.09.2023 in the matter of TVL V.V. Iron And Steels, Represented By its Proprietor Vs. The State Tax Officer, RS – VII, Intelligence – II, Chennai in W.P. No. 27140 of 2023, set aside the notice under Section 129(3) of the CGST Act, finding that the notice has been issued after the expiry of seven days from the date of detention.  It was also noticed that seven days has to be calculated from the date on which seizure of goods was to be effected and not from the following date.

The Petitioner filed the writ petition before the Hon’ble High challenging the notice in GST MOV – 07 dated 05.09.2023.

The facts of the case are that goods/conveyance were intercepted on 30.08.2023 and thereafter, the statements were recorded and order for physical verification/inspection of goods/conveyance and documents were issued in Form GST Mov-02 on the same date i.e., on 30.08.2023.

The case of the petitioner is that the impugned notice in Form GST Mov-07 has been issued beyond the period of limitation prescribed under Section 129(3) of the Central Goods and Services Tax (CGST) Act, 2017.  The impugned notice was received by the petitioner on 08.09.2023, which is beyond the statutory period of limitation.  Therefore, the impugned notice has to lapse in view of limitation prescribed under Section 129(3) of the Tamil Nadu Goods and Services Tax (TNGST) Act, 2017.

On the other hand, it was submitted on the behalf of the respondent that the notice was dispatched to the petitioner through e-mail at about 5.54 p.m. on 07.09.2023, and on the same day, the notice was also affixed on the vehicle.

Held: –

• The Hon’ble Court after considering the submissions made, facts of the case and the applicable provisions, found that the impugned notice ought to have been issued to the petitioner within seven days on the date of detention/seizure of goods/conveyance as is contemplated under Section 129(3) of the TNGST Act, 2017.
• On perusal of Section 129(3), it was found by the Hon’ble Court found that the language in Section 129(3) of the TNGST Act, 2017 is clear. Therefore, the notice specifying payment of penalty has to be issued within seven days of detention or seizure of goods. Further, the issuance of notice within seven days has to be calculated from the date on which seizure was to be effected and not from the following date. Thus, the last date for issuance of the impugned notice would have expired on 06.09.2023. However, the impugned notice has been dispatched through e-mail only on the following date i.e., on 07.09.2023 after the expiry of limitation.
• The Hon’ble Court therefore, on this ground only, quashed the impugned notice with a direction to the respondent to release the goods/conveyances of the petitioner, if they have not been released so far. However, liberty is given to the respondent to impose penalty under any other provisions of the Act, after complying with the same.

The Hon’ble Court with the above findings and observations, allowed the Writ Petition.