High Court quashed detention order of UP GST Authorities on presumption that goods was brought into State by two different vehicles by same e-way bill
ABCAUS Neutral Case Law Citation:
ABCAUS 3682 (2023) (03) HC
In the instant case a writ petition was filed by the assessee challenging the penalty order passed under Section 129(3) of the U.P. Goods and Services Tax Act, 2017 (GST Act) and the order passed by the Additional Commissioner (Appeal) State Goods and Service Tax.
The petitioner was a consignee of the goods was bringing the goods through the transporter from another State to the State of U.P..
The goods were carried by the transporter from other State after the required documents were handed over and e-way bill was generated. The goods were carried through a truck (say Truck No. 1) When the goods reached an intervening State it was shifted to another truck (say Truck No. 2). Thereafter, within the intervening State the goods were brought to another city where the goods were again transferred to say Truck No. 3. For final destination in the State of UP.
The goods which were in movement from Truck No. 3 to the place of destination were intercepted in Uttar Pradesh. The truck was detained. Thereafter, detention order was passed by the authorities.
Subsequently, the proceedings were initiated for imposing penalty and finally a penalty order was passed against which the first appeal was rejected vide impugned impugned order.
The petitioner submitted that the goods were dispatched by the cosigner to the consignee i.e. petitioner through the transporter. The truck which was bringing the goods was changed three times. He further contended that penalty order as well as appellate order has been wrongly passed solely on the surmises that Truck No. 2 had already brought the goods into the State of U.P. and this was the second shipment by the consignee bringing in the goods into the State of U.P. using Truck No. 3.
Whereas the Department submitted that first appellate authority had rightly found that the goods which were brought uptil other State by Truck No. 2 was in fact carried In the instant appeal, the assessee had challenged the order of CIT(A) in confirming UP and it was the second transaction done by the petitioner bringing in the goods from Other State to the State of U.P. through Truck No. 3. It was contended that during the examination of the documents of Truck No. 2, it had been found that e-way bill which was carried by that truck was different than the e-way bill Truck No. 3 was carrying.
The Hon’ble High Court found that this is a case where the authorities had proceeded merely on presumption that goods which were being transported from other State to UP were brought by the petitioner from the intervening State into the State of U.P. using two trucks.
The Hon’ble High Court observed that it was only when the Truck No. 3 was detained at UP, it was found that it was carrying the e-way bill No. different from e-way bill carried by Truck No. 2 along with all the required documents but a presumption was drawn that the earlier Truck No. 2 had brought the goods from intervening State to UP using the same e-way bill
The Hon’ble High Court opined that there was no material on record to demonstrate that goods were brought twice by the petitioner. The e-way bill on record demonstrated that cosigner had sent the goods through the transporter and e-way bill was generated at that time clearly shows that goods originated from other State and the transporter changed the truck two times at the intervening State. The truck no. 3 which was detained at UP through which goods were being carried accompanying second e-way bill.
The Hon’ble High Court stated that the presumption drawn by both the authorities cannot be accepted without there being any material on record that earlier the petitioner had brought the goods by truck no. 2.
The Hon’ble High Court held that the proceedings had been initiated solely on the basis of presumption that goods having been brought into the State using two different vehicles by same e-way bill. But once, it was found that the vehicle was carrying the required documents along with the e-way bill, no question arose for taking some other view.
Accordingly, the Hon’ble High Court set aside the penalty order and directed release of amount already deposited by the petitioner.
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