M/S Pashupati Metalloys vs. Chanchal Chauhan
Held
The Court held that no contempt was made out against the opposite party. The Court reasoned that a stay on a confiscation order under Section 130 of the Act does not automatically mandate the release of the confiscated goods. Instead, it means that the confiscated goods would not be put to auction, and the authorities would not proceed with actions like invoking Sections 78 & 79 for recovery of tax. The Court was not impressed by the petitioner's submission, opining that by not releasing the goods, the authorities had not committed any disobedience of the interim order passed by the Writ Court. Therefore, the contempt petition was dismissed.
Facts
This contempt petition was filed by the petitioner seeking enforcement of an interim order dated 31.12.2021 passed in WPMS No. 2886 of 2021. The interim order had stayed the effect and operation of a confiscation order dated 10.02.2021, passed under Section 130 of the Goods and Services Tax Act. The petitioner contended that pursuant to this interim order, their confiscated goods should have been released, and the failure to do so constituted civil contempt by the authorities. The revenue, represented by the learned Brief Holder, argued that the petitioner's place of business was not verifiable and there was a flight risk, and releasing the goods would render the writ petition infructuous.
Key Issues
1. Whether the failure to release confiscated goods, following a stay on the confiscation order under Section 130 of the Uttarakhand Goods and Services Act, 2017, amounts to civil contempt of court? Petitioner's argument: The petitioner argued that the interim order staying the confiscation order implied an obligation on the authorities to release the confiscated goods. Non-release constituted disobedience of the court's order, thus amounting to civil contempt. Revenue's argument: The revenue contended that the place of business of the petitioner firm was not verifiable and there was a flight risk. They further argued that releasing the confiscated goods pursuant to an interim order would make the writ petition infructuous and leave the revenue with no means to recover tax.
Sections Cited
Section 130, Section 129, Section 122, Section 78, Section 79
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SL. No Date Office Notes, reports, orders or proceedings or directions and Registrar’s order with Signatures COURT’S OR JUDGES’S ORDERS
CLCON No. 105 of 2022 Hon’ble Manoj Kumar Tiwari, J.
Mr. Sahil Mullick, learned counsel for the petitioner.
Mr. Mohit Maulekhi, learned Brief Holder appearing for the opposite party.
This contempt petition has been filed for enforcement of an interim order dated 31.12.2021 passed in WPMS No. 2886 of 2021. By the said order, effect and operation of confiscation order, passed under Section 130 of Goods and Services Tax Act on 10.02.2021, was stayed.
Learned counsel for the petitioner submits that pursuant to said interim order, goods of the petitioner which were confiscated, ought to have been released and by not releasing those goods, the authorities have committed civil contempt.
Section 130 of Uttarakhand Goods and Services Act, 2017 is reproduced below:- “130. Confiscation of goods or conveyances and levy of penalty. - (1) Notwithstanding anything contained in this Act, if any person - (i) supplies or receives any goods in contravention of any of the provisions of this Act o
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