Nirmal Kumar Mahaveer Kumar vs. Commissioner Of Central Goods And Services Tax And Another

Held

The Court held that the petitioner was not given a sufficient opportunity to establish that the delay in the transportation of goods was due to genuine reasons. The Court noted that the petitioner paid the tax and penalty promptly, indicating no intention to evade tax. The reason for the demand was solely the expired e-way bill at the time of interception. The Court observed that the petitioner did not get a chance to demonstrate that the goods could not reach their destination before the e-way bill's expiry. Consequently, the impugned order dated 31.12.2021 passed by the Appellate Authority was set aside. The matter was remanded to the Appellate Authority to take a fresh decision after providing the petitioner with a due opportunity to produce relevant evidence to establish the genuine reasons for the delay. The Court also directed the concerned officer to consider the provisions of Section 126 of the CGST Act, which deals with omissions or mistakes in documentation that are easily rectifiable. The Appellate Authority was also instructed to issue a written notice to the petitioner for a hearing.

Facts

The petitioner, Nirmal Kumar Mahaveer Kumar, filed a writ petition challenging an order dated 31.12.2021 passed by the Appellate Authority (respondent no. 2), which upheld a demand of Rs. 2,33,100/- towards tax and an equal amount towards penalty, totaling Rs. 4,66,200/-. This demand was raised by the Assistant Commissioner (respondent no. 3) under Section 129(3) of the CGST Act, 2017. The demand arose because the e-way bill accompanying the goods, transported from Guwahati to New Delhi, had expired at the time of interception on 29.09.2020, although the e-way bill was valid until 28.09.2020. The petitioner had paid the demanded tax and penalty on 30.09.2020, the same date the demand was raised, to facilitate the delivery of goods. The petitioner did not get an opportunity to explain the delay.

Key Issues

1. Whether the Appellate Authority erred in sustaining the demand for tax and penalty when the e-way bill had expired due to circumstances beyond the petitioner's control, specifically the breakdown of the initial vehicle and the subsequent requisitioning of another vehicle, thereby not providing the petitioner with a sufficient opportunity to explain the delay? (Mixed question of law and fact, turning on Section 129(3) and Section 126 of the CGST Act, 2017). Petitioner's Contention: The petitioner argued that the demand was raised due to the expiry of the e-way bill, which was not due to any intent to evade tax. The petitioner was keen to receive the goods and paid the demand immediately. The petitioner was not given a proper opportunity to establish that the delay was due to genuine reasons, such as vehicle breakdown. Revenue's Contention: The revenue, through its counsel, acknowledged that the vehicles were changed. The primary contention was that the e-way bill had expired at the time of interception, leading to the demand under Section 129(3) of the CGST Act.