Driver's unchallenged statement regarding route deviation justifies detention under Section 129 ignoring documents

Driver’s unchallenged statement regarding route deviation justifies detention under Section 129 ignoring documents

Issue

Whether the detention of goods and imposition of penalty under Section 129 of the GST Act are valid when based on the driver’s categorical statement (MOV-01) regarding the route and loading point, which contradicted the documents, and where such statement remained unchallenged by the assessee.

Facts

Interception & Statement: A vehicle transporting goods was intercepted. The driver’s statement was recorded in Form GST MOV-01.
Route Discrepancy: The driver categorically stated that the goods were loaded at Iglass and moved directly from Aligarh By-pass to Bulandshahar to Meerut.
Documentary Contradiction: This route contradicted the documents produced by the assessee, which claimed the movement was from Aligarh to Iglass.
Detention: Based on this discrepancy, physical verification was conducted (MOV-04), a detention order was passed, and a notice was issued.
Assessee’s Defense: The assessee filed a detailed reply arguing that valid documents were present at the time of seizure and that the detention was based merely on presumptions.
Impugned Order: The reply was rejected, and an order imposing tax and penalty was passed. The assessee challenged this order via a writ petition.

Decision

Sanctity of Driver’s Statement: The High Court held that the driver’s statement regarding the actual movement of goods was specific and categorical.
Failure to Rebut: It was observed that the assessee never challenged the driver’s statement at any stage of the proceedings, nor was any evidence produced to show the statement was made under duress.
Documents Irrelevant: In light of the unchallenged admission by the driver about the actual route, the documents showing a different route (Aligarh to Iglass) were of no assistance to the assessee.
Judicial Intervention Refused: The Court found no grounds to interfere with the detention and penalty orders as they were based on factual evidence (the statement).
Outcome: The writ petition was dismissed (effectively ruling in favour of the Revenue).

Key Takeaways

Evidentiary Value of MOV-01: A driver’s statement recorded in Form GST MOV-01 carries significant weight. If it reveals a route or loading point different from the documents (e-way bill), it can serve as the primary basis for detention.

Necessity of Rebuttal: If an assessee believes a driver’s statement is incorrect or coerced, they must actively challenge it during adjudication. Silence or failure to cross-examine implies acceptance of the statement’s truth.

Route Verification: Discrepancies in the actual physical route taken versus the declared route are treated as substantive material for suspecting tax evasion under Section 129.

HIGH COURT OF ALLAHABAD

Aasar Scrap Traders

State of U.P^*

Piyush Agrawal, J.

WRIT TAX No. 1223 of 2023

SEPTEMBER 22, 2025

Pranjal Shukla, Counsel for the Petitioner. Ravi Shankar Pandey, Learned ACSC for the Respondent.

ORDER

1. Heard Shri Pranjal Shukla, learned counsel for the petitioner and Shri Ravi Shankar Pandey, learned ACSC for the State -respondents.

2. The instant writ petition has been filed challenging the impugned order dated 14.07.2023 passed by the Additional Commissioner, Grade – 2 (Appeal – II), Meerut as well as the impugned order dated 18.08.2022 passed by the Assistant Commissioner, Commercial Tax, Mobile Squad, Basti.

3. Learned counsel for the petitioner submits that the petitioner is a Proprietorship firm and having GSTIN. The petitioner placed an order from the seller – M/s Jai Durga Scrape Traders, Aligarh and tax invoice no. 56 dated 15.08.2022 for a value of Rs. 562559/-was issued and the same was loaded in Truck No. UP 81 W 7624. He further submits that after delivery of the consignment at the place of the petitioner, the goods were again loaded for further shipment at purchaser firm – SSC Enterprises, Meerut Road, Muzaffar Nagar and another tax invoice no. 35 dated 16.08.2022 was issued and e-way bill was also generated. He further submits that when the vehicle was loaded with the goods and was moving on the road from Iglass, Aligarh to Meerut to Muzaffar Nagar on 17.08.2022, the same was intercepted by the Mobile Squad and the statement of the driver was recorded in MOV – 01 on 17.08.2022 itself. Physical verification was done and a report was prepared in GST MOV – 04. Thereafter, detention order was passed and notice was issued to the petitioner. He further submits that a detailed reply was submitted by the petitioner, but not being satisfied with the same, the impugned order dated 18.08.2022 was passed imposed tax and penalty. Aggrieved by the said order, the petitioner preferred an appeal, which has been dismissed vide impugned order dated 14.07.2023. Hence, this writ petition.

4. Learned counsel for the petitioner further submits that the goods of the petitioner were seized without any basis. At the time of seizure, all material was available and only on the basis of presumption, surmises and conjectures, the goods were detained, which is not permissible under the Act. He further submits that the seizure of the goods were made on the premise of availing wrongful ITC. In support of his submissions, he has placed reliance on the judgement of the Division Bench of this Court in Gobind Tobacco Manufacturing Co. v. State of U.P. (All)/Writ Tax No. 600/2022, decided on 17.05.2022.

5. Per contra, learned ACSC supports the impugned orders and submits that at the time of interception, the driver made the statement, which clearly demolishes the stand of the petitioner. The driver of the vehicle has made a statement that the truck was loaded on 16.08.2022 from morning to evening. Further, the driver has categorically made a statement that no goods were brought from Aligarh to Iglass. He further submits that the statement of the driver obtained/given at the first instance has more sanctity than the explanation furnished later. In support of his submissions, he has placed on the judgement of this Court in Ghata Mehandipur Balaji Grinding Works (P) Ltd v. CCT [Trade Tax Revision No. 15 of 2014, dated 25-3-2014] He further submits that the judgement relied upon by the petitioner is of no aid in the instant case.

6. After hearing learned counsel for the parties, the Court has perused the records.

7. It is not in dispute that at the time of interception, the driver of the vehicle made a categorical statement that the goods were loaded at the godwon situated at Iglass on 16.08.2022 from morning to evening and after the goods were loaded, the same directly moved from Aligarh By-pass to Bulandshahar to Meerut. The driver also categorically stated that no goods were ever loaded and transported from Aligarh to Iglass. In view of the said fact, the document prepared and presented that the goods moved from Aligarh to Iglass is of no help to the petitioner.

8. The statement of the driver, as held by this Court in Ghata Mehandipur Balaji Grinding Works (P) Ltd (supra), has more sanctity than the document and explanation furnished later on.

9. The statement of the driver has not been challenged at any stage, nor before this Court in any of the paragraphs of the writ petition. Further, no material has been brought on record to show that the statement of the driver was made under duress or otherwise. It is not the case of the petitioner that the signature of the driver was obtained on plain paper and thereafter, the contents have been filled up. Once the statement of the driver was not rebutted at any stage, the impugned orders cannot said to be arbitrary. The statement of the driver made at the first instance should be given more sanctity than the explanation furnished at a later stage.

10. In absence of any rebuttal by the petitioner that the statement of the driver was made in duress or otherwise, the statement given by the driver at the first instance has more value than the explanation furnished at a later stage. Therefore, the judgement relied upon by the petitioner in Ghata Mehandipur Balaji Grinding Works (P) Ltd (supra) is of no help to the petitioner.

11. In view of the aforesaid facts & circumstances of the case as noted above, no interference is called for in the impugned orders.

12. The writ petition is, accordingly, dismissed.