Mohin Khan vs. State Of C.G.

Held

The Court held that the contention raised by the learned State counsel, that the amended provision of Section 129 of the GST Act, which came into effect on 1st January 2022, cannot be made applicable in the case of the petitioner, has substance. The reasoning was that the proceedings for the detention of the petitioner's vehicle were instituted on 04.01.2021, prior to the effective date of the amendment. Since the amendment was given prospective effect only, the petitioner could not avail its benefit. Consequently, the petitioner's prayer for the release of the vehicle based on the amended provision was rejected. The Court found the reply of the Assistant Commissioner, rejecting the application, to be fully justified.

Facts

The petitioner, Mohin Khan, filed a writ petition before the Chhattisgarh High Court challenging a letter dated 01.02.2022 from the Assistant Commissioner of State Tax, Mahasamund. This letter rejected the petitioner's application for the release of his truck (registration No. OD-02-AY-8394) on supurdnama. The petitioner had previously filed a CRMP No. 227/2021, which was disposed of on 15.09.2021, directing him to apply for the vehicle's release under the GST Act. Subsequently, on 20.09.2021, the petitioner applied for release. The dispute centers on the applicability of an amended provision of Section 129 of the GST Act concerning vehicle release.

Key Issues

1. Whether the amended proviso to Section 129 of the GST Act, which came into effect on 1st January 2022, is applicable to the petitioner's case, which involves the detention of a vehicle initiated prior to this date? (Question of law) Petitioner's Argument: The petitioner contended that the amended proviso to Section 129 of the GST Act, allowing vehicle release upon payment of penalty or Rs. 1 Lakh (whichever is less), was not considered by the authority. He argued this omission was arbitrary, discriminatory, and violative of Article 14 of the Constitution of India. He relied on the amended provision of Section 129 of the GST Act. Revenue's Argument: The State-respondents argued that the amended proviso to Section 129 of the GST Act, inserted via the Finance Act, 2021, and effective from 1st January 2022, has no retrospective effect. Therefore, it cannot be applied to the petitioner's case, as the proceedings for detention were instituted on 04.01.2021. They stated the petitioner's liability for penalty was Rs. 34,65,144/-, not the minor amount mentioned in the amended proviso. They also highlighted that the petitioner failed to respond to notices served under Section 121 and demand notices (Form GST MOV-09) issued on 02.11.2021 and 11.11.2021, respectively.