M/S Om Prakash Kuldeep Kumar vs. Additional Commissioner Grade-2 And Another

Held

The Court held that the impugned order dated August 17, 2021, could not be sustained in law and was quashed. The Court found that the goods were accompanied by genuine documents, namely tax invoices and e-way bills, and the genuineness of these documents was not disputed. The Court perused the statement of the truck driver recorded in GST MOV-01 and found that it did not contain any statement regarding the goods being unloaded at a place not mentioned in the tax invoice. Furthermore, the Court noted that under the GST Act, there is no specific provision that binds a selling dealer to disclose the route to be taken during the transportation of goods. The legislature's deletion of such a provision from the previous VAT Act was significant. Therefore, the authorities were not correct in passing the seizure order, even if the vehicle was not on its regular route or was on a different route. The power of detention and seizure can only be exercised when goods are not accompanied by genuine documents, which was not the case here. The Court relied on the judgments of the Gujarat High Court in M/s Karnataka Traders and the Telangana High Court in Vijay Metal. The writ petition was allowed with costs.

Facts

The petitioner, M/s Om Prakash Kuldeep Kumar, a registered dealer, is challenging an order dated August 17, 2021, passed by the Additional Commissioner Grade-2 (respondent no. 1) under Section 129(3) of the UP GST Act, 2017. The petitioner had prepared tax invoices and e-way bills for the supply of bidi and match box. The goods were loaded onto a truck for transportation. During transit, the goods were intercepted, and a seizure/detention order was passed on January 17, 2020, followed by an order under Section 129(3). The petitioner deposited Rs. 2,36,304.68 under protest. An appeal against the order was dismissed. The petitioner contends that the goods were accompanied by genuine documents and were wrongly intercepted and penalized. The revenue argued that the driver's statement indicated goods were to be unloaded at Mainpuri, contrary to the documents.

Key Issues

1. Whether the interception and detention of goods were justified when accompanied by genuine tax invoices and e-way bills, despite allegations regarding the driver's statement and the route taken, under Section 129 of the UP GST Act, 2017? Petitioner's Arguments: The petitioner argued that the goods were accompanied by genuine documents (tax invoices and e-way bills) and were in transit to their final destination. They contended that the allegation that the driver stated the goods were to be unloaded in Mainpuri was incorrect, as the driver's statement recorded in GST MOV-01 did not support this. The petitioner also submitted that under the GST Act, there is no specific provision requiring disclosure of the transportation route, unlike the previous VAT Act, and therefore, no adverse inference could be drawn without cogent material. They relied on judgments from the Gujarat High Court in M/s Karnataka Traders Vs. State of Gujarat and the Telangana High Court in Vijay Metal Vs. Deputy Commercial Tax Officer. Respondent's Arguments: The respondent supported the impugned orders, arguing that the truck driver's statement at the time of interception indicated the goods were to be unloaded at Mainpuri, which was a contravention of the Act's provisions.