Allahabad HC quashes Penalty Orders for Goods Transported without E-Way Bill before 1st April [Read Judgment]

A Division Bench of Allahabad High Court, while allowing a bunch of petitions has set aside the departmental orders imposing the penalty against the traders for not bringing the E-Way bill for transportation of goods within the State.

The bench comprising Justices Sudhir Agarwal, and Ifaqat Ali Khan was hearing the petitions wherein various transportation of goods were seized on the ground that E-Way Bills were not accompanied by Transporters when goods were intercepted within the State of U.P. during Intra-State or Inter-State transportation.

Before the High Court, the petitioners challenged the orders of the department wherein the goods of the petitioners were detained for want of E-way Bill for the period prior to the E-Way Bill rollout in 1^st April 2018.

The petitioners vehemently argued that there was no requirement of accompanying said E-Way Bill as provisions of Provincial Statute cannot override provisions of Central Statue and, in any case, the omission is only indeliberate and unintentional.

The bench observed that “Since Rule 138 which came into force on 01.02.2018 vide Notification dated 31.01.2018 provided a complete procedure itself including the Forms we have no hesitation in observing that Rule 138 read with all subordinate legislation namely, Government’s Notification dated 21.07.2017 and Commissioner’s Circular dated 22.07.2017, 27.07.2017 and 09.08.2017 insofar as not consistent with Rule 138 (made effective from 01.02.2018), ceased to be operative on and after 01.02.2018. After 01.02.2018, Form Numbers required under Rule 138 (as came into force on 1.2.2018), were different than what was alleged to be non-possessed or obtained by Petitioners or Transporters, carrying goods in dispute by making reference to Government’s Notification dated 21.07.2017 and Commissioner’s Circular dated 09.08.2017. Even the authorities concerned, it is evident, were not clear as to what are the correct Forms in these cases.”

The bench observed that the impugned orders are not sustainable since the requirement of E-Way bill was made effective from 1.04.2018.

“In these peculiar facts and circumstances of the case, in our view, neither it can be said that Petitioners have deliberately committed any fault or disobeyed law intentionally or fraudulently, particularly when respondent-authorities themselves were not very clear. It also cannot be said that there is/was any intention of evasion of tax on the part of these petitioners. In the facts and circumstances, in all the writ petitions (except Writ Petition No. 87 of 2018), we are clearly of the view that seizure orders, show-cause notices issued under section 129 (3) and final orders, if any, are not sustainable in law,” the bench said.