M/S Yashi Enterprises vs. State Of U.P. And 2 Others

Heard Sri Pranjal Shukla, learned counsel for the petitioner and Sri R.S. Pandey, learned Additional Chief Standing Counsel for the State- respondents.

By means of instant writ petition, the petitioner has assailed the order dated 31.12.2019 passed in Appeal No.242/19/2019-20 by the Additional Commissioner, Grade-2, (Appeal), Commercial Tax, Basti as well as the order dated 08.05.2019 passed by the Assistant Commissioner, Commercial Tax, Mobile Squad, Basti.

Learned counsel for the petitioner submits that the goods in transit were accompanied with all proper documents, however, the same was seized only on the ground that the goods in transit were not on the regular route heading towards its destination. He further submits that under the GST Act, 2017 there is no specific provision which bound the transporter either to disclose the route to be taken by during the transportation/goods in transit and therefore, the goods in transit cannot be seized on the said ground.

He further submits that at the time of detention of goods in question, no discrepancy whatsoever was found in the accompanying documents with regard to its quality and quantity. He further submits that the authorities have not recorded any intention to evasion of payment of tax at any stage. He submits that due to the mistake of the driver of the vehicle whereby the goods were in transit, a long route was taken that cannot be the ground for seizure of the goods in transit.

In support of his submission, he has placed reliance upon the judgment of this Court passed in the case of M/s Om Prakash Kuldeep Kumar Vs. Additional Commissioner Grade-2 and another (Writ Tax No. 277 of 2022)

Per contra, learned Additional Chief Standing Counsel supports the impugned orders.

After hearing the parties, the Court has perused the record.

It is admitted that the goods were in transit from Meerut to Kanpur, but the same were intercepted at Basti on the ground that the goods in question are being transported on a different place than disclosed in the accompanying documents. No other discrepancy whatsoever has been pointed by the authorities at any stage of the proceedings below. Neither any finding has been recorded that the goods in question are different than mentioned in the accompanying documents. Once the authorities have failed to record any finding regarding intention of evasion of tax on the part of the petitioner and therefore, no adverse inference can be drawn against the petitioner.

Further, the record shows that there is no such provision under the GST Act which empower the authorities to seize the goods if the goods in transit were on a different route. Under the GST Act, no provision has been made for declaration of the route during the transition of the goods. In absence of any such declaration, the goods ought not to have seized.

This Court in the case of M/s Om Prakash Kuldeep Kumar (supra) in para no. 6, 10 & 11 has held as under:- "6. ............ in the present case there is no specific provision to declare the route which is to be taken for transporting the goods. He submits that in the earlier applicable VAT Act, there was a provision for declaring the route for transportation of the goods. He further submitted that in the absence of any specific provisions under the G.S.T. Act, no adverse inference can be drawn by the authorities without there being any cogent material on record. He prays for allowing the writ petition." xxx

Another issue raised that the goods along with truck was not on the route of its destination, therefore, there was intention to evade tax. Under the GST Act, there is no specific provision which bounds the selling dealer to disclose the route to be taken during transportation of goods or while goods are in transit however there was a provision under VAT Act to disclose the rout during transportation of goods to reach its final destination. Once the legislature itself in its wi om has chosen to delete the said provision, this Court opined that the authorities were not correct in passing the seizure order even if the vehicle was not on regular route or on different route.

The power of detention as well as seizure can be exercised only when the goods were not accompanying with the genuine documents provided under the Act. The genuineness of the documents has not been disputed at any stage."

The record further reveals that at the time of detention of the goods, the goods in question were in transit along with all the proper documents wherein no discrepancy whatsoever was found by the authorities and therefore, once the documents accompanied with the goods in question were found to be genuine in terms of quality and quantity, the same ought to not have been seized by the authorities.

In view of the above facts as stated as well as law laid down in the aforesaid judgment, the impugned orders cannot be sustained in the eyes of law and the same are hereby quashed.

Accordingly, the writ petition is allowed.

Any amount deposited by the petitioner pursuant to the impugned orders, shall be refunded to him within a month from the date of production of certified copy of this order. Order Date :- 21.4.2025 Pravesh Mishra PRAVESH KUMAR MISHRA High Court of Judicature at Allahabad