Copy Tech Business Machines PVT. LTD. vs. The Assistant State Tax Officer

Facts

The petitioner, Copy Tech Business Machines Pvt. Ltd., is engaged in the sale and servicing of photocopying machines. The 1st respondent, the Assistant State Tax Officer, Squad No. 3, SGST Department, detained the petitioner's goods on November 5, 2021, under Section 129 of the Goods and Services Tax Act, 2017, alleging discrepancies during transportation. The petitioner raised objections to this detention and submitted a reply, marked as Ext.P9, to the 1st respondent. The writ petition was filed before the High Court of Kerala seeking appropriate orders regarding the detention and the pending objections.

Held

The Court held that since the statute provides for appropriate orders to be issued pursuant to the filing of objections, the writ petition could be disposed of by directing the competent respondent to issue orders after considering Ext.P9. The Court did not delve into the merits of the detention or the petitioner's objections. Instead, it focused on the procedural aspect of ensuring that the statutory mechanism for addressing such grievances is followed. The reasoning was that the law itself contemplates a process for dealing with objections raised against the detention of goods. Therefore, the Court's role was to ensure that this process is duly initiated and completed. The ratio decidendi is that when a statutory provision allows for a reply to be filed against a detention order, and such a reply has been filed, the concerned authority must consider it and pass appropriate orders after providing an opportunity of hearing. The operative direction was to the competent amongst the respondents to consider Ext.P9, grant an opportunity of hearing to the petitioner, and issue appropriate orders in a time-bound manner. The petitioner was directed to appear before the respondents on February 22, 2022, at 11:00 am for the hearing.

Key Issues

1. Whether the High Court should entertain a writ petition when statutory remedies are available for challenging the detention of goods under Section 129 of the GST Act, 2017? The petitioner argued that the detention of goods was arbitrary and that their objections, submitted as Ext.P9, needed to be considered by the competent authority. They sought a direction from the Court for the authorities to pass appropriate orders after considering their reply. The petitioner relied on the principle that when a statute provides for a mechanism to address grievances, the authorities should follow that mechanism. The revenue, represented by the Assistant State Tax Officer and the Deputy Commissioner, Intelligence Department of SGST, did not explicitly record any arguments in the judgment. However, their action of detaining the goods under Section 129 implied their contention that the detention was justified under the law.