M/S Swapan Chandra De vs. The State Of Tripura And Ors

Held

The Court held that the impugned order dated 01.04.2022 passed by Respondent No. 3 and the demand dated 02.04.2022 passed by Respondent No. 4 are quashed and set aside. The reasoning is that Respondent No. 3, in violation of Section 129(4) of the CGST and SGST Act, 2017, which mandates an opportunity of being heard before determining penalty, passed the order imposing tax and penalty on the driver without giving the petitioner an opportunity to be heard. Furthermore, this action was in direct violation of this Court's previous order in WP(C) 285 of 2022, which directed the release of goods and vehicle upon an undertaking and required appropriate information to be provided to the assessing officer. The Court noted that the respondents did not issue any notice to the petitioner in terms of the earlier court order. The demand notice was also challenged as a violation of the principle of natural justice due to the absence of a show-cause notice. The Court allowed the writ petition, with liberty to the respondents to initiate steps in accordance with law.

Facts

The petitioner, M/s Swapan Chandra De, a civil contractor, purchased an automatic self-loading concrete machine. The seller, Podder and Podder Industries Pvt. Limited, purchased it from their Agartala showroom on 08.03.2022, paying IGST and TCS. The seller obtained an e-way bill valid until 17.03.2022. The vehicle transporting the machine developed a mechanical defect and reached Churaibari on 18.03.2022, after the e-way bill expired. The seller filed WP(C) 285 of 2022, and this court directed the release of goods and the vehicle upon an undertaking. However, Respondent No. 3 (Superintendent of State Tax) allegedly violated this order by assessing tax and penalty on the driver, and Respondent No. 4 (Sales Tax Officer) issued a demand notice to the petitioner. This writ petition challenges these actions.

Key Issues

1. Whether the order dated 01.04.2022 passed by Respondent No. 3 and the demand dated 02.04.2022 passed by Respondent No. 4 are liable to be quashed and set aside on the grounds of violation of the principles of natural justice and non-compliance with this Court's previous order in WP(C) 285 of 2022. Petitioner's arguments: The vehicle was detained due to an expired e-way bill caused by a mechanical defect. This court, in WP(C) 285 of 2022, directed the release of goods and vehicle upon an undertaking. Respondent No. 3, in violation of this order, passed an assessment order imposing tax and penalty on the driver and Respondent No. 4 issued a demand notice to the petitioner without issuing a proper show-cause notice to the petitioner. The notice was issued prior to the writ petition, but after the court's order in the previous writ petition, no fresh notice was issued to the petitioner. Respondents' arguments: The learned GA fairly submitted that no show cause notice has been issued to the writ petitioner, but after passing of the judgment, notice has been issued under the driver under statute.