Wrong Shipment Place in GST E-Way Bill No Ground for Seizure or Penalty: Allahabad HC [Read Order]

The GST authorities intercepted a consignment belonging to Petitioner-M/s Saumya near Mathura on its way to Himachal Pradesh.

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The driver of the vehicle disclosed that the goods were loaded from Nagpur, whereas the e-way bill and tax invoice mentioned Chandrapur (Maharashtra) as the place of dispatch.

Based only on this disparity, the authorities suspected tax evasion and treated the shipment as non-compliant, imposing an integrated GST and penalty.

The petitioner argued before the High Court that the mention of ‘Chandrapur’ instead of ‘Nagpur’ in the e-way bill was purely a technical error, as the company’s GST registration clearly listed Chandrapur as its principal place of business and Nagpur as an additional place.

The petitioner further contended that there was no attempt to conceal the transaction, and all goods and documents were otherwise in order. There was no mismatch in the quantity, quality, or nature of the goods transported.

After examining the facts and hearing both sides, the Court noted that the sole basis for the seizure was the statement of the truck driver about the loading point and the resulting technical mismatch in the e-way bill.

The Court observed that the basic purpose of the e-way bill under GST Act is to inform the department about the movement of goods so that proper tax assessment can be ensured at a later stage. If the transaction is authentic and traceable on the GST site, and the e-way bill is valid and hasn't been revoked, a minor technological error doesn't warrant a severe penalty.

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Justice Piyush Agarwal relied on its earlier decisions in M/s Zhuzoor Infratech Private Limited and reiterated that “merely on technical ground that in the e-way bill accompanying with the goods in question, the place of shipment has wrongly been mentioned, the seizure or levy of penalty cannot be made.”

The High Court, setting aside the orders of seizure and penalty, ordered the authorities to refund any amount already deposited by the petitioner within one month.

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