The Allahabad High Court ruled that the consignee is deemed owner if the invoice or any other specified document is accompanying the goods.
The petitioner, Western Carrier India Ltd, was aggrieved by an order to the writ petition whereby the liability has been fixed upon it to pay penalty in terms of Section 129 (1) b of the (Central Goods and Service Tax) C.G.S.T. Act, 2017. Further prayer made in the writ is to command the respondents to release the goods and the vehicle seized by respondents by accepting penalty in terms of section 129 (1)(a) of the GST Act.
In addition to other arguments advanced, the counsel for the petitioner placed reliance upon a circular issued by the Board on 31.12.2018 which provides that if the invoice or any other specified document is accompanying the consignment of goods then either the consigner or the consignee should be deemed to be the owner of the goods. Relying upon such circular, it was urged on behalf of the petitioner’s that the petitioner is a carrier and the goods transported by it was accompanied by E-Way bill and invoice etc.
It was further submitted that the authorities in such circumstances have erred in imposing penalty upon the petitioner inasmuch as by virtue of the aforesaid circular the petitioner was liable to be treated as the owner of the goods and consequently the provision of section 129(1)(a) alone could have been invoked.
The state counsel submitted that in respect of the demand of tax, the petitioner has the remedy of filing an appeal under Section 107 of the GST Act. So far as the prayer for release the goods and vehicle is concerned, the State counsel did not dispute the petitioner’s assertion that the goods in transit were accompanied by requisite documents including E-Way bill and invoice etc.
A Division Bench of Justices Ashwani Kumar Mishra and Syed Aftab Husain Rizvi observed that “It is hereby clarified that if the invoice or any other specified document is accompanying the consignment of goods, then either the consigner or the consignee should be deemed to be the owner. If the invoice or any other specified document is not accompanying the consignment of goods, then in such case, the proper officer should determine who should be declared as the owner of the goods.”
“We are of the view that the department ought to have considered the petitioner’s prayer for release of goods and vehicle upon compliance of the provisions contained under Section 129 (1) (a) of the Act. A direction accordingly is issued to the respondents to act in terms of the above circular and release the goods upon compliance of the condition stipulated under Section 129(1)(a)” the Bench noted.
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