M/S Regal Aluminium Company vs. State Of Gujarat

Facts

The writ-applicants, M/s Regal Aluminium Company, filed a writ application challenging the detention of their truck (GJ-01-DZ-0598) and goods. Initially, they sought release of the truck and goods by quashing the detention order (FORM GST MOV-06) and the notice for confiscation (FORM GST MOV-10). The petitioner argued that the confiscation notice could not be issued without a prior notice under FORM GST MOV-07. They proposed to pay the tax and penalty, approximately Rs. 4.60 Lakh, for the release of goods valued at around Rs. 19 Lakh. Subsequently, a final order of confiscation under Section 130 of the GST Act (FORM GST MOV-11) was passed. The petitioner then expressed willingness to challenge this order by filing an appeal under Section 107 and requested the release of goods and vehicle upon depositing the total amount towards tax, penalty, and fine in lieu of confiscation, which was around Rs. 19 Lakh. They clarified that Rs. 2.30 Lakh towards tax had already been deposited.

Held

The Court decided not to entertain the writ application directly for provisional release of goods and vehicle. Instead, it relegated the writ-applicants to avail the alternative remedy of preferring a statutory appeal against the final order of confiscation under Section 107 of the GST Act. The Court directed that any request for provisional release of goods and vehicle pending the appeal should be made before the appellate authority. The applicants were advised to prefer an application under Section 66(6) of the Act for provisional release. The Court stated that if such an application is filed, the appellate authority shall consider releasing the goods and vehicle upon the writ-applicants depositing the amount towards penalty and fine in lieu of confiscation, provided the tax amount has already been deposited. The Court explicitly clarified that it had not expressed any opinion on the merits of the confiscation order, which was also not on record.

Key Issues

1. Whether a notice under FORM GST MOV-10 for confiscation of goods and conveyance could be issued without first issuing a notice under FORM GST MOV-07? (Question of law, concerning procedural fairness under GST Act provisions). The petitioner argued that the confiscation notice was procedurally flawed as it bypassed the requirement of an initial notice (MOV-07). They contended that the goods and vehicle should be released upon payment of tax and penalty. The revenue's argument on this specific issue is not recorded. 2. Whether the High Court should entertain the writ application for provisional release of goods and vehicle, or should the petitioner be relegated to statutory remedies? (Question of mixed law and fact, concerning the scope of writ jurisdiction and alternative remedies). The petitioner requested provisional release pending the appeal. The Court considered the passing of the final confiscation order and the availability of a statutory appeal.