Facts of the Case:
In this case, the petitioner engaged in the business of trading cotton yarn, had its principal place of business and warehouse at Surat. It purchased cotton yarn from two suppliers located in Amreli and Mehsana, Gujarat, for onward transportation to Surat. The goods were transported through the usual route via Vadodara and Bharuch.
Due to heavy traffic congestion and diversion on the expressway, the driver who was unfamiliar with the local routes and belonged to Tamil Nadu mistakenly took a wrong turn towards Songadh instead of Surat. While halted near a hotel close to Bardoli toll plaza, the conveyance was intercepted by the GST authorities.
At the time of interception, the driver was in possession of all statutory documents, including tax invoices, e-invoices, transport receipts, and valid e-way bills. Due to a language barrier, the driver initially failed to understand the queries of the authorities but later produced all relevant documents. Physical verification confirmed that the quantity of goods matched the invoices.
Despite the above, the proper officer issued detention order in Form GST MOV-06 under Section 129(1); and did not issue notice under Section 129(3) in Form GST MOV-07 for determination of penalty. Aggrieved, the petitioner approached the High Court challenging the detention, confiscation proceedings, and violation of principles of natural justice.
Issue:
Whether detention of goods and conveyance under Section 129 was justified when all statutory documents were valid and available. Whether confiscation proceedings under Section 130 could be initiated without first following the mandatory procedure under Section 129. Whether issuance of Forms GST MOV-10 and MOV-11 without issuing notice under Section 129(3) and without granting opportunity of hearing was legally sustainable.
Held that:
The High Court disposed of the writ petition without entering into the merits of the case and held as under:
- The petitioner has an effective statutory remedy by way of appeal against the orders passed in Forms GST MOV-10 and MOV-11.
- The petitioner was granted liberty to file an appeal before the appropriate appellate authority and to raise all contentions urged in the writ petition.
- The appellate authority was directed to decide the appeal on merits and in accordance with law, preferably within a stipulated time.
- The appellate authority was specifically directed to examine the legality and propriety of invoking confiscation proceedings under Section 130, including whether issuance of Forms GST MOV-10 and MOV-11 was justified.
Case Name: Vivek Verma Versus State of Gujarat & Anr. dated 19.12.2025
To read the complete judgment 2025 Taxo.online 3450
