Shree Radhe Steel vs. State Of Gujarat

Held

The Court noted that the writ applicant had availed the benefit of the interim order and got the vehicle and goods released upon payment of the tax amount. The proceedings are at the show cause notice stage under Section 130 of the CGST Act, 2017, and are to proceed in accordance with law. The Court also highlighted the applicant's right to point out the recent pronouncement in Synergy Fertichem Pvt. Ltd. V/s. State of Gujarat, specifically paragraphs 99 to 104. These paragraphs emphasize that Section 130 (confiscation) should not be invoked at the threshold without proper application of mind and sufficient material to indicate an intent to evade tax. The Court clarified that while Section 130 can be invoked at the threshold, a strong case must be made out, supported by written reasons recorded by the authority, and potentially reviewed by a superior authority. The notice for confiscation must disclose the materials upon which the belief is formed. The Court concluded that it is now for the applicant to make good their case that the show cause notice deserves to be discharged. The writ application stands disposed of, with the rule made absolute to the extent that the proceedings will continue as per law, with the applicant having the liberty to rely on the cited judgment.

Facts

The petitioner, Shree Radhe Steel, filed a writ application challenging a Notice in Form GST MOV-10 dated March 9, 2019, issued by Respondent No. 2. The petitioner sought quashing of the notice and release of truck number GJ-01 DT 5949 along with its goods. Initially, a Co-ordinate Bench of the High Court noted that the confiscation notice was undated and the date for appearance was blank. The Court also observed that the petitioner claimed to have paid the tax and penalty. Consequently, the Court directed the respondents to forthwith release the truck and goods. The petitioner availed this interim relief and got the vehicle and goods released upon payment of the tax amount. The proceedings are currently at the show cause notice stage under Section 130 of the CGST Act, 2017.

Key Issues

1. Whether the Notice in Form GST MOV-10 dated 9.3.2019, issued by Respondent No. 2, is liable to be quashed and set aside, and if the truck and goods should be released, as per Article 226 of the Constitution of India? Petitioner's Contention: The petitioner argued that the notice was procedurally flawed, lacking a date and a specific date for appearance. They also claimed to have paid the tax and penalty, making the continued detention of the truck and goods unjustified. The petitioner relied on the interim order passed by the Court which directed the release of the vehicle and goods. They also sought to rely on the judgment in Synergy Fertichem Pvt. Ltd. V/s. State of Gujarat, particularly paragraphs 99 to 104, which discuss the invocation of Section 130 of the CGST Act. Revenue's Contention: The judgment does not record any specific arguments made by the revenue or State respondents in opposition to the writ application, beyond their appearance through the learned Assistant Government Pleader who waived service of notice.