Rajeshgupta Sanjeevgupta Proprietor Of M/S Radha Traders vs. State Of Gujarat

Held

The Court decided not to enter into the merits of the case, noting that the petitioner had sought time twice before the respondent authority for the hearing of the show cause notice. Consequently, the Court relegated the parties to the concerned officer for adjudication of the show cause notice. The averments made in the petition were to be construed as the reply to the show cause notice. The petitioner was given liberty to file additional submissions electronically. The adjudication was to be completed on or before April 30, 2021. If the timeline was not adhered to, the petitioner could revive the petitions. The respondent authority was directed to consider all contentions in accordance with the law, keeping in mind the decided case law on the subject, without being influenced by the disposal of these matters as the merits were not considered by the Court.

Facts

The petitioner, proprietor of M/s. S. R. Matches, dispatched 488 bundles of safety matches valued at Rs. 1,01,114/- with IGST, accompanied by an invoice and e-way bill valid until March 26, 2021. The transporter chose a route via Gujarat for reasons of road conditions, mileage, and safety. Upon reaching Songadh Post in Surat, Gujarat, on March 19, 2021, the vehicle was stopped by Respondent No. 4. The authorities issued Form GST MOV-01 and MOV-02, and subsequently, an order of detention under Section 129(1) of the CGST Act, 2017, citing the longer route taken as a ground for suspicion of delivery within Gujarat. A representation for release was made on March 22, 2021. A show cause notice under Section 130 of the CGST Act, 2017, was issued on March 24, 2021, alleging a longer route, under-valuation, and detention of the driver.

Key Issues

1. Whether the detention of the vehicle and goods was justified under Section 129(1) of the CGST Act, 2017, based on the transporter's choice of route, and whether the subsequent issuance of a show cause notice under Section 130 of the CGST Act, 2017, was procedurally correct? Petitioner's Arguments: The petitioner argued that the transporter's choice of route was a matter of discretion and not a valid ground for suspicion or detention. They contended that the authorities failed to follow due procedure, specifically relying on the decision in Synergy Fertichem Pvt. Ltd. vs. State of Gujarat, Special Civil Application No. 4730 of 2019, which laid down guidelines for detention. The petitioner also argued that the show cause notice under Section 130 was issued without proper application of mind and lacked foundation. Revenue's Arguments: The Revenue argued that the show cause notice required adjudication and that intervening at this stage would be premature. They emphasized that the driver was not detained and was free to go. The Revenue assured that adjudication would be done at the earliest.