M/S Diamond Metal vs. State Of U.P. And 2 Others

Held

The Court held that the detention of goods and the vehicle was not justified solely on the basis of a minor discrepancy in the vehicle number on the E-way bill. The Court relied on the Government of India's circular dated 14.09.2018, which explicitly states that minor errors in vehicle numbers on the E-way bill are not sufficient grounds for initiating proceedings under the Act. The ratio decidendi is that minor technical discrepancies, when tax is paid and no intent to evade tax is apparent, should not lead to the detention of goods and vehicles. The Court directed the respondents to release the goods and the vehicle of the petitioner forthwith upon the petitioner furnishing an indemnity bond equivalent to the tax and penalty amount mentioned in the notice under Section 129(3) of the Act.

Facts

The petitioner, M/s Diamond Metal, a registered dealer, had its aluminium scrap intercepted and detained while being transported from Kanpur to Jaunpur. The detention occurred under Section 129(1) of the U.P. GST Act because the vehicle number recorded during interception did not match the vehicle number mentioned on the E-way bill. The petitioner had already paid the requisite tax as per the invoice.

Key Issues

1. Whether the detention of goods and vehicle under Section 129(1) of the U.P. GST Act is justified solely on the ground of a minor discrepancy in the vehicle number mentioned on the E-way bill, when the tax has been paid as per the invoice? Petitioner's contention: The petitioner argued that the discrepancy in the vehicle number was minor and that the detention was unjustified, especially in light of the Government of India's circular dated 14.09.2018, which clarifies that minor discrepancies in E-way bill details, such as one or two digits/characters of the vehicle number, should not lead to proceedings under the Act. Respondent's contention: The respondents, represented by the Standing Counsel, did not record any specific arguments in the judgment regarding their justification for detention beyond the initial reason cited.