M/S Sk Trading Company vs. State Of U.P. And Another

Held

The Court did not decide the merits of the petitioner's claim regarding the interpretation of Section 67(6) or their entitlement to release of goods. Instead, the Court noted that an appeal under Section 107 against the order rejecting the petitioner's application for release of goods was already filed and pending consideration. Consequently, the Court held that since the petitioner was already availing a statutory alternative remedy, it would not interfere in the writ petition. The Court dismissed the writ petition, with an observation that the appellate authority should decide the pending appeal as expeditiously as possible. The revenue stated that the next date fixed in the appeal was December 14, 2020, and assured that if the appeal was in order and the petitioner cooperated, it would be decided on that date or within a week thereafter.

Facts

The petitioner, M/s SK Trading Company, filed a writ petition seeking a mandamus to release goods and a truck detained by the Assistant Commissioner, Mobile Squad-10, Kanpur, vide detention order dated November 7, 2020. The petitioner, identified as the consigner, expressed willingness to deposit the applicable tax and penalty in cash or via bank guarantee as per Section 129(1)(a) of the Uttar Pradesh Goods and Services Tax Act, 2017, read with Section 67(6) and Rule 140(1). The petitioner contended that their application for release was wrongly dismissed, holding them disentitled because they were not the owner of the goods, which they argued was an incorrect interpretation of Section 67(6). The revenue relied on the Supreme Court's decision in State of U.P. vs. Kay Pan Fragrance (P) Ltd.

Key Issues

1. Whether the petitioner, as the consigner, is entitled to the release of detained goods and truck upon payment of tax and penalty in cash or bank guarantee, as provided under Section 129(1)(a) of the Uttar Pradesh Goods and Services Tax Act, 2017, read with Section 67(6) and Rule 140(1), despite not being the owner of the goods? Petitioner's contention: The petitioner argued that the interpretation of Section 67(6) by the detaining authority, which denied release based on non-ownership, was unjustified and contrary to the statutory provisions. They asserted their right to release upon fulfilling the payment requirements. Respondent's contention: The State respondents relied on the Supreme Court's decision in State of U.P. vs. Kay Pan Fragrance (P) Ltd., specifically paragraphs 4 and 10, and sub-section (6) of Section 67. They argued that the goods are not liable for release merely on payment of tax and penalty in cash or bank guarantee, implying that other conditions or interpretations might apply.