The Kerala High Court held that the provision of confiscation of goods or conveyances and levy of penalty under section 30 can be invoked in absence of material.
The petitioner, Ouseph K.M. is the owner of the goods consigned from Kanyakumari in Tamil Nadu to Kalyan in Maharashtra, as well as the owner of the vehicle in which the said goods were being transported. The goods and the vehicle, during the course of transit through the State of Kerala, were detained by the respondents at Vattolipady near Perumbavoor.
The consignment, on interception, was found to be covered by an invoice as well as an e-way bill that showed the payment of GST for the inter-state movement covering the journey from Kanyakumari to Kalyan.
The detention, however, was for the reason that the vehicle was apprehended at a place that was not on the normal route between Kanyakumari and Maharashtra.
The respondent authority passed orders in FORM GST MOV-11, confiscating the goods and the vehicle, confirming a tax and penalty on the goods, and permitting a redemption of the goods and vehicle on payment of redemption fine.
The petitioner approached the Court challenging the confiscation order passed against him. The issue that is now raised before this Court is as regards the legality of the confiscation orders passed under Section 130 of the GST Act.
The single-judge bench of Justice Jayashankaran Nambiar observed that the irregularity in the documents that accompanied the transportation surely made it out to be a case that justified a detention of the goods under Section 129 of the GST Act.
The court said that merely on detecting an irregularity in the documents that are to accompany the transportation of goods, the respondents would be justified in detaining the goods and passing the necessary order under Section 129(3) of the GST Act.
The high court while quashing the impugned orders passed against the petitioners under Section 130 of the GST Act in FORM GST MOV-11, directed the respondent authority to pass orders based on the material available with them, and the statements taken from the petitioners under Section 129(3) of the GST Act.
The court permitted the petitioners to obtain a release of the goods and the vehicle on payment of the tax amount in cash and furnished a bank guarantee for the penalty amounts confirmed against them. On the respondents passing the order under Section 129(3) of the GST Act, they will be free to invoke the bank guarantee for the realization of the penalty amounts.
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