Vehicle to be released on furnishing of bond held by Tripura High Court
E Way Bill is an Electronic Way bill for movement of goods to be generated on the eWay Bill Portal. A GST registered person cannot transport goods in a vehicle whose value exceeds Rs. 50,000 (Single Invoice/bill/delivery challan) without an e-way bill that is generated on ewaybillgst.gov.in. Alternatively, Eway bill can also be generated or cancelled through SMS, Android App and by site-to-site integration through API. When an eway bill is generated, a unique E way Bill Number (EBN) is allocated and is available to the supplier, recipient, and the transporter.
Eway bill must be generated when there is a movement of goods of more than Rs 50,000 in value to or from a registered person. A Registered person or the transporter may choose to generate and carry eway bill even if the value of goods is less than Rs 50,000. In case goods are moved without generating a valid e-way bill, the authorities may impose a penalty of 10,000 INR or amount of tax sought to be evaded, whichever is higher.
Fact of the case
In the given case the the petitioner has stated that for two vehicles used consecutively, the valid e-way bills were generated, but due to sudden lock down the consignment could not be brought into the State of Tripura within the time. Even they could not generate a new e-bill against a new vehicle where as the petitioner was compelled to cause trans-shipment as the earlier vehicle got completely broken down while stranded for the nationwide lock-down. The petitioner has also stated that they made an attempt to have the amended e-way bill, but as the system was not approached within the valid time i.e. within 24 hrs of the expiry date, the system refused to generate a fresh e-way bill at their instance. The said vehicle reached to the Churaibari check post, when the Superintendent of State Tax (GST) Churaibari Enforcement Wing detained the said vehicle finding that the proper E-way bill was not being carried by the said vehicle. As a result, when the vehicle was detained in the Churaibari check post, as the vehicle was not carrying the valid e-way bill. The petitioner got the Eway bill amended by the competent authority and the same was produced to the said superintendent but he denied to take cognizance of the amended e-way bill and refused to release the goods that was being carried by the said vehicle.
Issue of the case
The issue of the case is with regards the quantum of penalty for transportation of the taxable goods without the cover of valid e-way bill.
Observation of the court
The learned counsel has contended that there was no fraudulent intention or malafide act indulged by the petitioner. It was a lapse under very abnormal circumstances of lockdown and that aspect of the matter has not been considered at all. Moreover, taxpayer has submitted that while imposing the penalty the Superintendent of State Tax has exceeded his authority as provided under Section 126 of the CGST Act and as reproduced above. According to the learned counsel, even the general principles in imposing the penalty (see Section 126 of the CGST Act) has not been taken serious care of, in as much as Section 126 of the CGST Act parts on a direction on the officers who are authorized to impose tax. On considering the proportionality vis- a-vis the omission or mistake in documentation and mistake committed without fraudulent intent or gross negligence, the quantum of penalties is supposed to be recorded.
The Additional Authority of GST has submitted that true it is that the breach is covered under Section 122(xiv) of the CGST Act. But the petitioner has committed gross negligence by not upgrading or amending the e-way bill when the regular e-way bill had expired in transit. The e-way bill was upgraded or amended when the consignment was detained. As such, there is no irregularity or lack of proportionality in imposing the penalty. The learned Additional Authority of GST has pointed out that the penalty has been imposed only for not tendering the valid e-way bill for the movement of the vehicle with goods. Tax and the penalty have been imposed as per the law. On query from this court, Additional Authority of GST has submitted that in respect of the payment of the tax by the petitioner, the respondents have not stated anything specifically or in denying the statement in that regard.
The court is satisfied that the breach definitely falls within the ambit of Section 122(xiv) of the CGST Act and as such the petitioner is excisable to the penalty. But the pertinent question that falls for consideration is whether the Superintendent of State Tax has exceeded his jurisdiction in imposing the penalty? Having read the provisions of imposing penalty as provided under Section 122 of the CGST Act, court is of the view that for the breach which falls under Section 122(xiv), the penalty is fixed @Rs.10,000/-. So far the penalty for an amount equivalent to tax is concerned those are for the incidents when the tax is sought to be evaded or not deducted under Section 51 etc. The other incidences as cataloged in Section 122 of the CGST Act are not relevant to the present case and as such cort is of the firm view that the Superintendent of State Tax has exceeded his jurisdiction while imposing the penalty. The penalty would have been Rs.10,000/-. As there is no dispute about the tax, court will not lay our hands on that aspect. the learned counsel has categorically stated that the petitioner has paid the said tax. We are also not accepting that statement on the face of it. The revenue authority shall be at liberty to verify that fact to ascertain whether tax has been paid or not. In the event of non- payment of tax the appropriate action be taken for realizing the said tax from the petitioner. But in the circumstances, we set aside the order of penalty and direct the petitioner to pay the sum of Rs. 10,000/- as penalty for the breach which is covered under Section 122(xiv) of the CGST Act within a period of 1 month from today. If not paid, the action as prescribed by the statue be followed for realizing the same.
The High Court held that it would be appropriate for fair ends of justice that the respondents shall release the goods and the vehicle, if the taxpayer furnished the indemnity bond undertaking clearly that in the event of any adverse order from the court or on the issuance of direction to make tax and penalty as imposed by the Superintendent of State Tax (GST), Churaibari Enforcement Wing, the petitioner shall, within seven days, pay the entire amount to the competent authority without raising any further plea.
Read the full court order from below Link]Vehicle-to-be-released-on-furnishing-of-bond-held-by-Tripura-High-Court