Penalty for alleged double movement of goods on same e-way bill deleted as it was based was based only on vehicle driver’s statement
In a recent judgment, the Hon’ble Allahabad High Court has deleted GST penalty u/s 129(3) for alleged double movement of goods on same e-way bill as penalty was based only on vehicle driver’s statement.
ABCAUS Case Law Citation:
ABCAUS 4048 (2024) (05) HC
In the instant case, the assessee had filed a writ petition challenging the seizure order and the order imposing penalty under Section 129(3) of the Uttar Pradesh Goods and Service Tax Act, 2017 (UPGST Act) and the appellate order.
The sole ground on which the goods were detained and seized and penalty order was passed, was the statement supposedly given by the Driver of the vehicle who submitted that he was transporting the goods for the second time with the same documents.
The assessee submitted that the relevant documents were present in the vehicle and the goods matched invoice and the e-way bill. It was further submitted that the primary documents being MOV-01 wherein the statement of the Driver was recorded had not been provided to the petitioner.
Upon a query on MOV-01 put by the Hon’ble High Court, the Officer concerned had not been able to provide the MOV-01 in spite of several requests made to him by the counsel. However, a sheet of paper that was supposedly the statement given by the Driver was produced before the Court. However, the same was not accompanied by the MOV-01. The Hon’ble High Court opined that the sheet of paper was of no evidentiary value.
The assessee placed reliance on a judgement of a coordinate Bench of the Hon’ble High Court wherein his Lordship had held that where assessee had pleaded a negative fact, the initial onus was on the assessing authority to lead positive evidence. Mere assertion made at the end of the seizure order that it was clearly established that the assessee had made double use of the e-way bills is merely a conclusion drawn bereft of material on record. It is the reason based on facts and evidence found by the assessing authority that has to be examined to test the correctness of the order and not the conclusions, recorded without any material on record.
The Hon’ble High Court observed that in view of the ratio laid down in the above judgement, it is clear that it is the duty of the authorities to ascertain that whether the double movement of the goods has taken place actually.
The Hon’ble High Court further observed that in the present case, no such burden of proof had been discharged by the authorities. From the documents available, it was clear that the authorities had not been able to indicate or prove any mens rea for evasion of tax.
Accordingly, the Hon’ble High Court quashed and set aside the impugned orders
However, the Hon’ble High Court recorded a caution to the authorities in respect of the non-assistance and non providing the relevant documents to the counsel appearing on behalf of authorities resulting in failure of the department’s lawyers to defend the case of the department in an effective manner. The Hon’ble High Court stated that on several occasions it has passed orders in favour of the assessee as the department has not able to defend its case by timely providing relevant documents to the State counsel. The Commissioner, State Tax, U.P. was directed to take note of this fact and ensure that in future proper assistance is provided to the counsel appearing on behalf of the State.
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