Srs Travels/Logistics vs. Joint Commissionier Of Commercial Taxes
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The petitioner, SRS Travels/Logistics, filed a writ petition challenging an order dated 11.03.2019 passed by the Commercial Tax Officer (Enforcement)-5, Belagavi. This order was purportedly made under Section 129 of the Karnataka Goods and Services Tax Act, 2017, which deals with the detention and seizure of vehicles transporting goods in contravention of the Act. The petitioner sought to quash this order. The respondents, represented by the Joint Commissioner of Commercial Taxes (Enforcement)-NZ and the Commercial Tax Officer (Enforcement)-5, argued that Section 129 empowers the detention and seizure of the vehicle used for transporting the goods in question.
Held
The Court noted that both parties, after some argument, reached a broad agreement. The agreement was that the vehicle in question could be retained by the petitioner if a Bank Guarantee equivalent to the value of the goods was furnished on or before 10th April 2019. If this condition was not met, the official respondents would be at liberty to seize and detain the vehicle, with the assistance of the police force and RTO if necessary. The Court recorded this understanding and disposed of the writ petition accordingly. The specific findings on the validity of the original order under Section 129, beyond the agreed settlement, were not elaborated upon.
Key Issues
1. Whether the order dated 11.03.2019, passed by the respondent No.2 Commercial Tax Officer (Enforcement)-5 under Section 129 of the Karnataka Goods and Services Tax Act, 2017, for detention and seizure of the transport vehicle, is valid and legally sustainable? The petitioner argued for the quashing of the order. The respondents contended that Section 129 of the Karnataka Goods and Services Tax Act, 2017, empowers the detention and seizure of the vehicle used for the transportation of goods in question, and therefore, the order passed by the respondent No.2 cannot be faulted. The judgment does not explicitly mention any specific precedents or circulars relied upon by either side, beyond the interpretation of Section 129 itself.
Sections Cited
Section 129
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORDER
The challenge is to the order dated 11.03.2019 at Annexure-H purported to have been made under Section 129 of the Karnataka Goods and Services Tax Act, 2017 which, in substance, provides for detention and seizure of the transport vehicle to coerce recovery of tax and penalty in certain circumstances.
Learned Additional Government Advocate, Smt. Veena Hegde and Sri. Anilkumar Biradar, Commercial Tax Officer (Enforcement) 5, Belagavi – respondent No.2 herein, who is present in the Court, submit that the text and context of this Section empowers detention and seizure of the vehicle that was used for transportation of goods in question and therefore, the order cannot be faltered.
: 3 :
Section 129 of the Karnataka Goods and Services Tax Act, 2017, reads as under: “129. Detention, seizure and release of goods and conveyances in transit.- (1) Notwithstanding anything contained in this Act, where any person transports any goods or stores any goods while they are in transit in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the said goods and documents relating to such goods and conveyance shall be liable to detention or seizure and after detention or seizure, shall be released.– (a) on payment of the applicable tax and penalty equal to one hundred per cent of the tax payable on such goods and, in case of exempted goods, on payment of an amount equal to two per cent of the value of goods or twenty five thousand rupees, whichever is less, where the owner of the goods comes forward for payment of such tax and penalty;
(b) on payment of the applicable tax and penalty equal to the fifty per cent of the value of the goods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent of the value of goods or twenty five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty;
(c) upon furnishing a security equivalent to the amount payable under clause (a) or clause
: 4 : (b) in such form and manner as may be prescribed:
Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods.
(2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for detention and seizure of goods and conveyances.
(3) The proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c).
(4) No tax, interest or penalty shall be determined under sub-section (3) without giving the person concerned an opportunity of being heard.
(5) On payment of amount referred in sub- section (1), all proceedings in respect of the notice specified in sub-section (3) shall be deemed to be concluded.
(6) Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within seven days of such detention or seizure, further
: 5 : proceedings shall be initiated in accordance with the provisions of section 130: Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of seven days may be reduced by the proper officer.”
However, having argued the matter for some time resisting the writ petition, both the sides now are in broad agreement that the vehicle in question can be retained by the petitioner by furnishing a Bank Guarantee for the value of the goods in question on or before 10th April 2019, failing which the official respondents are at liberty to seize and detain the vehicle with the police force and of RTO, if so required.
Keeping the above understanding on record, this writ petition is disposed off. JUDGE
Kms
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.