M/S Aasar Scrap Traders vs. State Of U.P. And 2 Others
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The petitioner, M/s Aasar Scrap Traders, challenged orders passed by the Assistant Commissioner, Commercial Tax (18.08.2022) and the Additional Commissioner, Grade-2 (Appeal-II) (14.07.2023). The petitioner had placed an order from M/s Jai Durga Scrape Traders, Aligarh, receiving tax invoice no. 56 dated 15.08.2022 for Rs. 562559/-. These goods were loaded onto Truck No. UP 81 W 7624. After delivery, the goods were reloaded for shipment to SSC Enterprises, Muzaffar Nagar, with a new tax invoice no. 35 dated 16.08.2022 and an e-way bill. On 17.08.2022, the vehicle was intercepted by the Mobile Squad. The driver's statement was recorded (MOV-01), physical verification was done (MOV-04), and subsequently, detention orders and notices were issued. The petitioner submitted a reply, but the Assistant Commissioner imposed tax and penalty. The petitioner's appeal was dismissed by the Additional Commissioner.
Held
The Court held that the driver's statement recorded at the time of interception, stating that the goods were loaded at Iglass on 16.08.2022 and moved directly from Aligarh By-pass to Bulandshahar to Meerut, and that no goods were transported from Aligarh to Iglass, was crucial. The Court found this statement to be categorical and not challenged by the petitioner at any stage, including in the writ petition. No material was presented to show the driver's statement was made under duress. The Court reiterated the principle, citing M/s Ghata Mehandipur Balaji Grinding Works Private Limited, that a driver's initial statement has more sanctity than a later explanation. Since the driver's statement was not rebutted, the impugned orders were not considered arbitrary. Therefore, no interference was called for in the impugned orders. The Court found no merit in the petitioner's reliance on M/s Gobind Tobacco Manufacturing Company & Another.
Key Issues
1. Whether the detention and seizure of goods were made without basis and on presumptions, surmises, and conjectures, contrary to the provisions of the GST Act? (Question of law) 2. Whether the seizure of goods was justified on the premise of availing wrongful Input Tax Credit (ITC)? (Question of mixed law and fact) Petitioner's arguments: The goods were seized without any basis, relying solely on presumption, surmises, and conjectures, which is impermissible. All necessary documentation was available at the time of seizure. The petitioner relied on the judgment in M/s Gobind Tobacco Manufacturing Company & Another Vs. State of U.P. & 2 Others. Revenue's arguments: The driver's initial statement, recorded at the time of interception, has greater sanctity than subsequent explanations. The driver stated the goods were loaded on 16.08.2022 and did not originate from Aligarh to Iglass. The revenue relied on the judgment in M/s Ghata Mehandipur Balaji Grinding Works Private Limited Vs. CCT and argued that the petitioner's relied-upon judgment was not applicable.
Sections Cited
Not specified in the judgment
AI-generated summary — verify with the full judgment below
Reserved On:16.09.2025 Delivered On:22.09.2025 HIGH COURT OF JUDICATURE AT ALLAHABAD WRIT TAX No. - 1223 of 2023 M/S Aasar Scrap Traders …..Petitioners(s) Versus State Of U.P. And 2 Others …..Respondents(s) Counsel for Petitioners(s) : Pranjal Shukla Counsel for Respondent(s) : C.S.C. Court No. - 7 HON'BLE PIYUSH AGRAWAL, J.
Heard Shri Pranjal Shukla, learned counsel for the petitioner and Shri Ravi Shankar Pandey, learned ACSC for the State – respondents.
The instant writ petition has been filed challenging the impugned order dated 14.07.2023 passed by the Additional Commissioner, Grade – 2 (Appeal – II), Meerut as well as the impugned order dated 18.08.2022 passed by the Assistant Commissioner, Commercial Tax, Mobile Squad, Basti.
Learned counsel for the petitioner submits that the petitioner is a Proprietorship firm and having GSTIN. The petitioner placed an order from the seller – M/s Jai Durga Scrape Traders, Aligarh and tax invoice no. 56 dated 15.08.2022 for a value of Rs. 562559/- was issued and the same was loaded in Truck No. UP 81 W 7624. 2 WRIT TAX No. - 1223 of 2023 He further submits that after delivery of the consignment at the place of the petitioner, the goods were again loaded for further shipment at purchaser firm – SSC Enterprises, Meerut Road, Muzaffar Nagar and another tax invoice no. 35 dated 16.08.2022 was issued and e-way bill was also generated. He further submits that when the vehicle was loaded with the goods and was moving on the road from Iglass, Aligarh to Meerut to Muzaffar Nagar on 17.08.2022, the same was intercepted by the Mobile Squad and the statement of the driver was recorded in MOV – 01 on 17.08.2022 itself. Physical verification was done and a report was prepared in GST MOV – 04. Thereafter, detention order was passed and notice was issued to the petitioner. He further submits that a detailed reply was submitted by the petitioner, but not being satisfied with the same, the impugned order dated 18.08.2022 was passed imposed tax and penalty. Aggrieved by the said order, the petitioner preferred an appeal, which has been dismissed vide impugned order dated 14.07.2023. Hence, this writ petition.
Learned counsel for the petitioner further submits that the goods of the petitioner were seized without any basis. At the time of seizure, all material was available and only on the basis of presumption, surmises and conjectures, the goods were detained, which is not permissible under the Act. He further submits that the seizure of the goods were made on the premise of availing wrongful ITC. In support of his submissions, he has placed reliance on the judgement of the Division Bench of this Court in M/s Gobind Tobacco Manufacturing Company & Another Vs. State of U.P. & 2 Others [Writ Tax No. 600/2022, decided on 17.05.2022].
Per contra, learned ACSC supports the impugned orders and submits that at the time of interception, the driver made the statement, which clearly demolishes the stand of the petitioner. The driver of the vehicle has made a statement that the truck was 3 WRIT TAX No. - 1223 of 2023 loaded on 16.08.2022 from morning to evening. Further, the driver has categorically made a statement that no goods were brought from Aligarh to Iglass. He further submits that the statement of the driver obtained/given at the first instance has more sanctity than the explanation furnished later. In support of his submissions, he has placed on the judgement of this Court in M/s Ghata Mehandipur Balaji Grinding Works Private Limited Vs. CCT [Trade Tax Revision No. 15 of 2014, decided on 25.03.2014]. He further submits that the judgement relied upon by the petitioner is of no aid in the instant case.
After hearing learned counsel for the parties, the Court has perused the records.
It is not in dispute that at the time of interception, the driver of the vehicle made a categorical statement that the goods were loaded at the godwon situated at Iglass on 16.08.2022 from morning to evening and after the goods were loaded, the same directly moved from Aligarh By-pass to Bulandshahar to Meerut. The driver also categorically stated that no goods were ever loaded and transported from Aligarh to Iglass. In view of the said fact, the document prepared and presented that the goods moved from Aligarh to Iglass is of no help to the petitioner.
The statement of the driver, as held by this Court in M/s Ghata Mehandipur Balaji Grinding Works Private Limited (supra), has more sanctity than the document and explanation furnished later on.
The statement of the driver has not been challenged at any stage, nor before this Court in any of the paragraphs of the writ petition. Further, no material has been brought on record to show that the statement of the driver was made under duress or otherwise. It is not the case of the petitioner that the signature of the driver was obtained on plain paper and thereafter, the contents have been 4 WRIT TAX No. - 1223 of 2023 filled up. Once the statement of the driver was not rebutted at any stage, the impugned orders cannot said to be arbitrary. The statement of the driver made at the first instance should be given more sanctity than the explanation furnished at a later stage.
In absence of any rebuttal by the petitioner that the statement of the driver was made in duress or otherwise, the statement given by the driver at the first instance has more value than the explanation furnished at a later stage. Therefore, the judgement relied upon by the petitioner in M/s Ghata Mehandipur Balaji Grinding Works Private Limited (supra) is of no help to the petitioner.
In view of the aforesaid facts & circumstances of the case as noted above, no interference is called for in the impugned orders.
The writ petition is, accordingly, dismissed. (Piyush Agrawal,J.) September 22, 2025 Amit Mishra AMIT KUMAR MISHRA High Court of Judicature at Allahabad
Reproduced from the public record of the Allahabad High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.