The Gujarat High Court has granted an interim order allowing release of the vehicle seized by the GST department under sections 129 and 130 of the CGST Act by noting that the notice issued prima facie do not comply the requirements of section 129 of the Act.
The department had seized the goods for the reason that it was not accompanied by an E-way bill during the course of transit and therefore, passed the detention order under section 129(1) of the CGST Act.
The petitioners submitted that it is only if there is no compliance of the order passed under section 129 of the Act, that the provisions of section 130 of the IGST Act can be resorted to. It was also submitted that the same seeks to impose penalty, redemption fine and confiscation under section 130 of the Act without initiating any proceedings under section 129 of the Act, which is not permissible in law.
It was further submitted that the integrated goods and services tax has already been paid on the goods in question at the time of import thereof and that the goods in question are perishable goods with a limited shelf-life.
Section 129(3) stipulates that the proper officer detaining or seizing the goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c). Subsection (4) provides that no tax, interest or penalty shall be determined under subsection (3) without giving the person concerned an opportunity of being heard.
The bench comprising Justices Harsha Devani and Bhargav D Karia noted that the show-cause notice dated 01.03.2019 has been issued under section 130 of the CGST Act calling upon the petitioner to show cause as to why the goods in question as well as the vehicle should not be confiscated for non-payment of an amount of Rs.60,72,639/, as detailed therein.
While passing an interim order, the bench held that “On a query by the Court, the learned Assistant Government Pleader is not in a position to point out that the procedure, as contemplated under subsections (3) and (4) of section 129 of the CGST Act, has been followed. Thus, prima facie, it appears that the show-cause notice under section 130 of the CGST Act has been issued without complying with the requirements of section 129 of the CGST Act. It is also an In the aforesaid premises, in the opinion of this Court, the petitioner has made out a strong prima facie case for the grant of interim relief. By way of interim relief, the respondents are hereby directed to forthwith release the goods in question and the Truck bearing registration no. detained / seized under purported exercise of powers under sections 129 and 130 of the CGST Act. However, the petitioner shall file an undertaking before this Court within a week from today to the effect that in case the petitioner, ultimately, does not succeed in the petition, he shall duly cooperate in the further proceedings.”
Subscribe Taxscan Premium to view the Judgment
