M/S Shree Radhemani Multitrade PVT. LTD vs. State Of Chhattisgarh

Facts

The petitioner, M/s Shree Radhemani Multitrade Pvt Ltd, is challenging the detention order (Form GST MOV-06) and subsequent notice (Form GST MOV-07) issued by the Deputy Commissioner, Commercial Tax, GST Department, Raipur Division-II. The petitioner's vehicle, carrying TMT bars purchased on February 7, 2025, was intercepted on February 7, 2025, at 8 am. The petitioner contends that a valid E-Way Bill was generated at 11:24 am on February 7, 2025, for supply to Madhya Pradesh, and another E-Way Bill was generated at 1:47 am on February 7, 2025, for delivery within Raipur. The authorities detained the vehicle on the grounds that it was not carrying an E-Way Bill for subsequent sale from Raipur to Madhya Pradesh at the time of interception, and that the vehicle was moving in the opposite direction of the initial E-Way Bill's intended route.

Held

The Court held that the writ petitions are not maintainable at the motion stage. The primary reasoning was that a detention order had been passed, followed by a show-cause notice, providing the petitioner with an opportunity for hearing, which constitutes substantial compliance with natural justice. The Court found that the authorities had valid jurisdiction because the vehicle was intercepted at Dharsiva towards Bilaspur, which was the opposite direction of the route for which an E-Way Bill was generated, and a subsequent E-Way Bill was issued for Madhya Pradesh. The Court distinguished the case laws cited by the petitioner, stating that the facts in M/S Satyam Shivam involved traffic blockages and in M/s Falguni Steels, there were technical issues with the E-Way Bill portal. The Court concluded that there were no good grounds to entertain the writ petitions, deeming them premature. Therefore, the petitions were dismissed at the motion stage.

Key Issues

1. Whether the writ petition is maintainable against a show-cause notice and detention order when a statutory mechanism for release of goods and conveyances exists under the CGST Act, 2017? (Section 129(3) of CGST Act, 2017). Petitioner's arguments: The petitioner argued that the writ petition is maintainable because the order was passed without jurisdiction and the notice was issued with premeditation, citing Siemens Ltd. v. State of Maharashtra. They also contended that the detention was arbitrary, as a valid E-Way Bill was generated. They referred to the Supreme Court's consideration of explanations in cases of expired E-Way Bills (Assistant Commissioner (ST) & ORS. vs. M/S Satyam Shivam Papers Pvt. Limited & Anr.) and the distinction between technical errors and intentional evasion (M/s Falguni Steels vs. State of U.P.). Revenue's arguments: The State argued that the writ petitions are premature as only a show-cause notice has been issued, and an opportunity for hearing has been provided under Section 129(3) of the CGST Act, 2017. They cited Whirlpool Corporation vs. Registrar of Trade Marks for the principle that writ petitions should not be entertained against show-cause notices. They also relied on Commissioner of Central Excise, Haldia v. Krishna Wax Private Limited, stating that writ petitions against show-cause notices are normally not entertained. Furthermore, they cited State of Uttar Pradesh And others vs. Kay Pan Fragrance Private Limited, emphasizing that a complete statutory mechanism exists for release and disposal of seized goods under the CGST Act, 2017, and Rule 138 of the CGST Rules, 2017, mandates E-Way Bill generation before movement of goods.