M/S Siddh Trading Co. Thru. Proprietor And Auth. Signatory Mr.Siddartha Bhagwani vs. State Of U.P. Thru. Finance Secy. Ministry Finance Lko. And Another

Held

The Court held that the failure to issue Part B of the E-Way Bill, when the E-invoice clearly contained the vehicle number, was a technical error and did not demonstrate an intention to evade tax. The Court found that the ratio of law laid down in M/s Rawal Wasia Yarn Dying Pvt. Ltd. (supra) was applicable to the present case. The Court reasoned that the presence of the vehicle number in the E-invoice negated any intent to evade tax. Consequently, the orders dated 03.02.2024 and 04.05.2024 were quashed. The matter was remanded to the Adjudicating Authority to pass fresh orders in light of the precedent established in M/s Rawal Wasia Yarn Dying Pvt. Ltd. The Court did not expressly leave any issue undecided.

Facts

The petitioner, M/s Siddh Trading Co., challenged an order dated 03.02.2024, which imposed a liability of Rs. 2,90,250/-. This order was passed by respondent no. 3. The petitioner also challenged an order dated 04.05.2024 by the Additional Commissioner, Grade-2 (Appeal)-II, State Tax, Ayodhya, which dismissed their appeal against the initial order. The dispute arose when a vehicle transporting goods was intercepted on 03.02.2024, and it was found that Part B of the E-Way Bill had not been issued in support of the E-Way Bill. Consequently, a penalty was imposed under Section 129 of the UPGST Act, 2017.

Key Issues

1. Whether the failure to issue Part B of the E-Way Bill, when the E-invoice clearly mentioned the vehicle number, constitutes an intention to evade tax, thereby justifying the penalty under Section 129 of the UPGST Act, 2017? The petitioner argued that the vehicle number was correctly mentioned in the E-invoice, and the omission in Part B of the E-Way Bill was due to a technical glitch in the computer software. They contended that there was no intention to evade tax. The petitioner relied on the judgment in M/s Rawal Wasia Yarn Dying Pvt. Ltd. Vs. Commissioner Commercial Tax and Another, which held that an error in uploading Part B is technical when the invoice contains vehicle details and does not indicate an intention to evade tax. The respondent (State) did not record any specific arguments against the petitioner's submissions.