Minor Penalty attracted for Bonafide Error in GST E-Way Bill Format: Kerala High Court [Read Order]

Minor Penalty -Bonafide Error - GST E-Way Bill Format - Kerala High Court - Taxscan

The Kerala High Court has held that the bonafide errors in the e-way bill formats would attract minor penalty under the GST law.

The petitioner/assessee, M/s Greenlights Power Solutions, has a valid GST registration and carries on business in electrical contract work. In connection with the work of a hospital in Assam, some goods were transported by a vehicle after paying the required tax. During the course of transportation from Ernakulam, the goods were intercepted by the department, who detained the goods under section 129 of the Central Goods and Service Tax Act, 2017 on noticing an irregularity in the e-way bill.

According to the petitioner, the error occurred due to the default computer formatting system. Instead of day-month-year (dd-mm-yyyy) formatting for the Indian system, the computer-generated bill provided a month-day-year (mm-dd-yyyy) format. As a result, instead of 02.03.2021, the invoice bill mentioned the date as 03.02.2021. Due to the irregularity in the invoice, the goods were detained and tax along with the penalty was demanded.

Justice Bechu Kurian Thomas observed that the discrepancy pointed out is only on the date of invoice which is shown as 03.02.2021 while that shown in the e-way bill was 02.03.2021.

“All other details in the invoice and the e-way bill including the nature of goods transported, the details of consignor and consignee, the GSTIN of supplier and recipient, place of delivery, invoice number, value of goods, HSN code, vehicle number etc. tallied and had no discrepancy. Thus the error noticed is insignificant and not of any consequence for invoking the power conferred under section 129of the Act to impose tax and penalty,” the Court said.

While concluding, the Court added that “The situation arising in the instant case, warranted imposition of only a minor penalty as contemplated under the Circular. In view of the above, the imposition of tax and penalty upon the petitioner to the extent imposed in Ext.P6 is perverse and illegal, warranting interference under Article 226 of the Constitution of India.”

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