Court Grants Interim Stay on Penalty for Not Mentioning Biltee Number on Tax Invoice
Issue
The central legal question is whether a penalty can be lawfully imposed on a taxpayer for failing to mention the “biltee number” (transport document number) on a tax invoice, especially when Rule 46 of the UPGST Rules, which prescribes the contents of a tax invoice, does not explicitly list it as a mandatory field.
Brief Facts
The tax department imposed a penalty on the assessee for a procedural lapse: the tax invoice issued by them did not contain a “biltee number” (i.e., the Lorry Receipt or transport consignment number). The assessee challenged this penalty before the High Court, arguing that there is no legal requirement under Rule 46 of the GST Rules to mention this specific detail on the invoice.
Decision
The court did not pass a final judgment but issued an interim order in favor of the assessee.
The court acknowledged that the assessee’s argument “required consideration,” meaning it had prima facie merit. While awaiting a formal reply (counter-affidavit) from the tax department, the court granted interim relief to the taxpayer.
The order stated that no coercive action could be taken to recover the penalty until the next hearing date, on the condition that the assessee deposits 20% of the disputed penalty amount. Any amount already paid would be adjusted against this requirement.
Key Takeaways
- Penalty Must Be Based on a Specific Rule Violation: A penalty cannot be imposed for the omission of information on a document if the law does not explicitly mandate the inclusion of that information.
- Prima Facie Case Leads to Interim Relief: When a court finds that a taxpayer has a strong, arguable case, it is likely to grant interim relief (like a stay) to prevent undue hardship while the legal issue is fully examined.
- Conditional Stays: In tax disputes, interim stays on recovery are often made conditional upon the taxpayer depositing a portion of the disputed amount, balancing the interests of the taxpayer and the revenue.