The Karnataka High Court directed the department to release the confiscated Areca Nut on condition specified. The goods were confiscated due to non-submission of E waybill. The bench modified the conditions imposed by the single judge.
M/S Quadri and Company, the petitioner filed a petition for setting aside the interim orders passed in the writ petitions which the order was purportedly passed relying upon the re-appreciation of transaction value by the Assistant Commissioner of Taxes [Enforcement].
The appellant has also sought a direction from the commissioner of commercial taxes to pass fresh orders as to the legality and validity of restatement and reappraisal of the transaction value. Appellant has also sought direction for the release of the consignment and conveyance on payment of (i) 20% of deposit of penalty imposed; (ii) secure balance of consignment value as per tax invoice by a bank guarantee leaving the question of validity restatement and reappraisal of transaction value to be agitated in statutory appeal.
Counsel for the appellants Sri. Bharat Raichandani, Advocate for Sri-Gangadhar S.Hosakeri and Sri.D.M.MalIi, Advocates for appellants, it comes out that the main grievance of the petitioner is that the condition imposed for release of goods by the learned Single Judge is onerous and ought to be modified.
The petitioner had raised an invoice on the consignee for the supply of areca nuts and had handed over the goods to the transporter, who had hired conveyance to transport the goods. The said conveyance was intercepted by the Assistant Commissioner of Commercial Taxes (Enforcement). Physical verification was conducted and an impugned order of detention under section 129 of the GST Act, came to be passed detaining the conveyance and the goods.
The report of the value by CAMPCO was to the effect that goods were undervalued. Without the proceedings under section 129 of the Act having concluded, it is asserted that a confiscation notice came to be issued followed by a confiscation order.
The said order was challenged by filing an appeal under section 107 of the Act and certain payments were made upon dismissal of such appeal, further appeal was preferred and an order in appeal under of KGST Act came to be passed,
The counsel for the petitioner has contended that the proceedings under section 129 of the Act having been initiated could not have been abandoned midway and proceedings for confiscation under section 130 of the Act be proceeded with. It is further contended that the conditions imposed are onerous and the question of imposing conditions based on value of goods does not arise.
The question relating to the validity of the order under section 130 of the Act is a matter still pending adjudication before the learned Single Judge. Though the counsel for the petitioner has submitted that imposition of condition should be restricted to tax and penalty cannot be linked to the value of goods, such contention cannot be accepted. The proceedings under Section 130 of the Act relate to confiscation of goods and if such proceedings are upheld then the property would vest with the revenue and the revenue would be entitled to sell the property and appropriate the proceeds.
A division bench comprising Justice S Sunil Dutt Yadav And Justice Vijaykumar Aspatil modified the interim order dated 25.09.2023 passed by the Single Judge as follows
“a) The appellants are to make good the 25% deposit provided for in appeal proceedings as regards the order impugned in the writ proceedings. It ‘is made clear that the deposit- made in the earlier appeals by the appellant could be adjusted.
b) The appellants are to make good tax and penalty as per the orders impugned before the learned Single Judge by securing the same by way of bank guarantee.
c) The appellants are to furnish a bank guarantee insofar as the value of goods as per his invoice.
d) The appellants are to furnish a personal bond of the Proprietor representing the appellants to the extent of the differential value of the goods as per the invoice of the appellants vis-å-vis the valuation by CAMPCO made on behalf of the State.”
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