U.S.Girish vs. The State Tax Officer

On 04.03.2021, petitioner allegedly carried 1033.630 gms of gold ornaments to Mangalore by train. When he reached near the Palakkad Junction Railway Station, a search was conducted by the Railway Police Force and gold ornaments were detected and seized from the petitioner. Intimation was given to the GST department consequent to which proceedings were initiated under sections 129 and 130 of the Act, since petitioner had apparently omitted to carry the delivery chalan

The detention of gold ornaments belonging to the petitioner was challenged in W.P.(C) No.6802 of 2021 before this Court. During the pendency of the said writ petition, proceedings under section 130 of the Act was initiated and therefore the said writ petition

Ext.P5 order of confiscation was subsequently issued by the first respondent on 20.03.2021 alleging that the transportation of gold ornaments by the petitioner without any of the mandatory documents prescribed under section 31 of the Act read with rule 55 of the CGST Rules, 2017, was done with an intention to evade the payment of tax. The aforesaid order dated 20.03.2021 was challenged by the petitioner in this writ petition initially.

While so, taking recourse to sub section (7) of section 130 of the Act, a final intimation was given to the petitioner by Ext.P6, conveying that if petitioner fails to remit the amount demanded before 19.06.2021, the Proper Officer will initiate further steps to sell the confiscated gold ornaments in locally and deposit the sale proceeds with the Government in accordance with the statutory provisions. The writ petition was later amended to include the challenge against Ext.P6 also.

I have heard Adv.Harisankar V. Menon, learned counsel for the petitioner as well as Dr.Thushara James, learned Senior Government Pleader for the respondents.

Learned counsel for the petitioner contended that in view of the decision in Gokul P.G. and Ors. v. The State of Kerala and Ors. [(2021) 88 GSTR 282 (Kerala)], the confiscation ought not to have been initiated when there was no intention to evade tax. It was argued that other than a mere expression in words by the Proper Officer in Ext.P5 that “there was an intention to evade tax”, there was nothing on record to come to a statutory conclusion regarding any attempt to evade tax. It was further pointed out that the omission to carry the delivery challan by itself may only warrant an imposition of penalty and not confiscation of goods and therefore, the impugned order was liable to be set aside.

The learned Senior Government Pleader on the other hand submitted that from the time of admission itself, this Court had refused to interfere with the order impugned and therefore, the order of confiscation dated 20.03.2021 worked itself out as per section 130(7) of the Act as on 19.06.2021 and at this belated point of time this Court ought not consider the merits of the contentions raised by the petitioner. It was further argued that even otherwise, petitioner had an efficacious remedy of appeal under section 107 of the Act, which he opted not to initiate and further, in view of the factual

I have considered the rival contentions. Ext.P5 order clearly endorses the satisfaction of the Proper Officer that the mandatory documents prescribed under section 31 of the Act read with rule 55 of the CGST Rules, 2017 was admittedly not available with the petitioner while transporting the huge quantity of gold ornaments. After conducting a hearing, pursuant to the notice issued, the officer came to the conclusion that absence of delivery challan and the circumstances attended therewith clearly showed an intention to evade tax without any ambiguity. The aforesaid conclusion is a finding of fact. This finding cannot be interfered with in exercise of the powers under Article 226, unless it is perverse or without anything explicitly contradicting such a finding. The proposition canvassed by the petitioner requires an appreciation of disputed factual questions. Such an opportunity is not available under Article 226 of the Constitution of India and the remedy for the petitioner is to move the Appellate Authority.

The question whether absence of mandatory documents in