The Madras High Court has held that there was only technical breach without intention to evade GST and quashed order detaining consignment and vehicle.
The petitioner, M/S.Smart Roofing Private Limitedhad consigned the goods from its main place of business at Chennai to its additional place of business, SasthaBombalanModern Rice Mill, Madurai. This was not the additional place of business, as per the original registration certificate obtained by the petitioner. However, in the E-way bill and the delivery Challan, the petitioner had declared the consignee as 130, Ring Road Chintamani, Madurai, though the consignment was meant for being discharged at its new place of business at SasthaMombalan Modern Rice Mill, Madurai. Under these circumstances, the consignment along with lorry was detained and a show cause notice, to which the petitioner has replied, which has culminated in the impugned order seeking to impose penalty of Rs.5,00,774/- under Section 129(3) of the CGST Act, 2017.
The petitioner submitted that there is no intention to evade tax as the petitioner has generated E-way bill by declaring the consignee as its additional place of business at No.130, Ring Road Chintamani, Madurai. It is further submitted that ex post facto, i.e., on the date of the petitioner has taken steps for amending the registration by including SasthaMombalan Modern Rice Mill, Madurai, also as the additional place of business. The imposition of penalty under Section 129 (3) is unwarranted under the circumstances.
The High Court has observed that there is no doubt; the authorities acting under the Act were justified in detainingthe goods inasmuch as there is a wrong declaration in the E-way bill. However, the facts indicate that the consignor and the consignee are one and the same entity, namely, Head Office and the Branch Office. In this case, the petitioner has a new place of business, but had not altered the GST Registration. However, steps have been taken to ex post facto include the new place of business altering the GST Registration. The registration certificate has also been amended.
The single bench Justice C. Saravanan while disposing the writ petition has held that “considering the fact that there is only a technical breach committed by the petitioner and there is no intention to evade tax, I am inclined to quash the impugned order and allow this writ petition by directing the respondent to release the vehicle and the consignment to the petitioner, if the same has not been released already”.
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