M/S.Bhima Enterprises vs. The Joint Commissioner
Facts
The petitioner, M/s. Bhima Enterprises, filed a writ petition seeking to quash a seizure order dated August 16, 2023, passed by the Joint Commissioner (2nd respondent) and to direct the respondents to release the seized goods. The goods were seized on August 16, 2023, by the Superintendent (2nd respondent) due to excess stock found with the petitioner. The petitioner contended that they had already paid the applicable tax and penalty. The petitioner submitted representations on August 18, 2023, and September 14, 2023, requesting the release of the goods. The respondents are the Joint Commissioner, Superintendent, and Inspector of Central GST and Excise, Tirunelveli Division.
Held
The Court held that the seizure order dated August 16, 2023, was illegal to the extent that the goods were not released after the petitioner paid the applicable tax and penalty. The Court reasoned that under Section 67(6) of the CGST Act, seized goods are to be released on payment of the applicable tax, interest, and penalty. Since the petitioner had fulfilled this condition by paying the tax and penalty, they were entitled to the release of the goods. The Court found it unnecessary for the petitioner to execute a bond or furnish security in this scenario. The ratio decidendi is that once the tax and penalty are paid as per Section 67(6), the authorities are bound to release the seized goods. The Court directed the respondents to release the seized goods within two days of receiving a copy of the order.
Key Issues
1. Whether the seizure order dated August 16, 2023, passed by the 2nd respondent is illegal and liable to be quashed, considering the petitioner has paid the applicable tax and penalty? (Question of law and fact, turning on Section 67(6) of the CGST Act). Petitioner's Arguments: The petitioner argued that since they have paid the entire tax and penalty, the goods seized should be released. They relied on Section 67(6) of the CGST Act, which allows for the release of seized goods on payment of applicable tax, interest, and penalty, or upon execution of a bond and furnishing of security. The petitioner contended that payment of tax and penalty negates the need for a bond or security. Revenue's Arguments: The judgment does not record any specific arguments made by the respondents.
Sections Cited
Section 67(6)
AI-generated summary — verify with the full judgment below
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 26.09.2023 CORAM: THE HONOURABLE MRS.JUSTICE S. SRIMATHY W.P(MD) No. 23502 of 2023 and W.M.P.(MD)No.19708 of 2023 M/s.Bhima Enterprises, represented by the Accountant, L.N.Rajesh, No.8/7, Ramapuram West, Manikattipotta, Pottal Post, Nagercoil, Kanniyakumari District-629 501. :Petitioner ..Vs.. 1.The Joint Commissioner, Office of the Central GST and Excise, Tirunelveli Division, 2nd Floor, Central Revenue Building, Tractor Road, NGO “A” Colony, Tirunelveli – 627 007. 2.The Superintendent, Office of the Central GST and Excise, Tirunelveli Division, 2nd Floor, Central Revenue Building, Tractor Road, NGO “A” Colony, Tirunelveli – 627 007. 1/5 https://www.mhc.tn.gov.in/judis
The Inspector, Office of the Central GST and Excise, Tirunelveli Division, 2nd Floor, Central Revenue Building, Tractor Road, NGO “A” Colony, Tirunelveli – 627 007. : Respondents
PRAYER: Writ Petition filed under Article 226 of the Constitution of to issue a writ, order or direction, more particularly in the nature of a WRIT OF CERTIORARIFIED M
The judgment continues below.
Read the full judgment
A free account opens 10 full GST judgments a month (one account works on both bharattax.net and this site). Re-reading one you have already opened does not count again.
The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.
Reproduced from the public record of the Madras High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.