GST: Punjab and Haryana HC orders to release detained Goods on Furnishing Security [Read Order]

In an assessee-favour ruling, the Punjab and Haryana High Court has asked the GST department to release the detained goods on furnishing security other than bank guarantee or cash.

In the instant case, the goods belong to the petitioners were seized by the department and levied penalty. The goods detained are still in custody of the Departments concerned. Against the order, the petitioners filed statutory appeals and paid pre-deposit of 10% of the disputed tax amount. In terms of Section 107(7) of the Act, recovery of the balance amount was deemed to be stayed.

As per Section 129(1)(c) of the Act, goods can be released on furnishing of security as prescribed. Section 129(2) of the Act provides for application of Section 67(6) of the Act, which in turn has been referred to in Rule 140 prescribing the bond and the bank guarantee to be furnished.

While granting an interim relief to the petitioners, Justice Rajesh Bindal and Justice Mahabir Singh Sindhu said that “Considering the fact that the legal issues sought to be raised by the petitioners need examination in detail by the GST Council and the goods detained are still in custody of the Departments concerned, we deem it appropriate to direct the respondents to release the goods on furnishing of security other than bank guarantee or cash. The needful be done within one week. As there is no dispute regarding identity of the goods, the release shall not be treated as provisional.”