Detention of Goods and Conveyance: Factual Disputes Require Adjudication, Not Writ Intervention

(Last Updated On: February 19, 2025)

Detention of Goods and Conveyance: Factual Disputes Require Adjudication, Not Writ Intervention

Summary in Key Points:

Issue: Should the High Court intervene in a writ petition challenging the detention of goods and conveyance when there are disputed questions of fact regarding compliance with Section 129 and the origin of goods?
Facts: The petitioner challenged the seizure of their vehicle, arguing that the authorities failed to comply with the procedural requirements of Section 129, including providing reasons for seizure and issuing a show cause notice within the stipulated time. The respondent authority claimed that they followed the procedure and issued the necessary notices but could not complete the proceedings due to the petitioner’s non-cooperation. There was also a dispute about the origin of the goods.
Decision: The court held that the factual disputes, such as whether notices were issued and the origin of goods, could not be resolved in a writ proceeding. The court directed the respondent authority to complete the proceedings expeditiously, allowing the petitioner to raise their objections and present their case during the adjudication process.

Important Note: This decision reiterates the principle that writ jurisdiction is not suitable for resolving factual disputes. When there are contested claims about events and evidence, the appropriate forum for resolution is the regular adjudication process, where evidence can be presented and assessed. The court’s decision to direct the respondent authority to complete the proceedings ensures that the factual disputes are properly addressed, and the petitioner has an opportunity to present their case before a final decision is made. This ruling respects the statutory framework and prevents the High Court from overstepping its jurisdiction in matters involving disputed questions of fact.

HIGH COURT OF ANDHRA PRADESH

Madhagoni Venkaiah

Deputy Assistant Commissioner State Tax

R. Raghunandan Rao and MAHESWARA RAO KUNCHEAM, JJ.

WRIT PETITION NO: 29363 of 2024

DECEMBER 24, 2024

J.N. Venkata Suresh Kumar for the Petitioner.

ORDER

R Raghunandan Rao, J.- The petitioner is the owner of a lorry bearing registration No.TS05 UC 2257. This vehicle was seized by the 1^st respondent, on 03.11.2024, in Vijayawada, while the said vehicle was transporting 21,625 kgs of iron and steel scrap along with the necessary E-way bill that had been handed over to the driver of the vehicle, by the consignor, who is the 6^th respondent. This consignment was to be delivered from Vijayawada to Hyderabad in Telangana State.

2. The petitioner, being aggrieved by the seizure of the vehicle, has approached this Court, by way of the present Writ Petition.

3. Sri J. N. Venkata Suresh Kumar, learned counsel appearing for the petitioner assails the said seizure of the vehicle, on two grounds. Firstly, Section 129 of the Goods and Services Tax Act, 2017 (herein-after referred to as “the Act”) requires the authorities, seizing the vehicle, to furnish reasons for such seizure and to issue a show cause notice within 7 days from the date of seizure. Thereafter, the authorities, seizing the vehicle, would also have to pass an order within a further period of 7 days from the issuance of notices. The learned counsel submits that no notices have been issued and as such the petitioner is entitled to the release of the vehicle without any further proceedings being necessary.

4. The learned counsel would also contend that the power of Section 129 of the Act can be exercised only if necessary jurisdictional facts are made out. He submits that the power of seizure, under Section 129 of the Act, would be available to the authorities, only if the transport of the goods is in contravention of the Act or Rules. The learned counsel submits that the requirement of a transporter is to ensure that the goods, which are transported, are transported with an E-way bill and other documents. He would submit that it is an admitted fact that the goods in question, which was iron and steel scrap, was accompanied by an E-way bill, generated by the consignor, under the GST portal and that a physical inspection of the goods showed that the description of the goods and the quantity of the goods matched with the details given in the E-way bill. The learned counsel would submit that, in such circumstances, the power under Section 129 of the Act cannot be invoked at all.

5. The 1^st respondent has filed a counter affidavit. Along with this counter affidavit, certain material papers have also been filed.

6. According to the 1^st respondent, the driver of the vehicle, one Sri S. Suresh, was served with the order of detention on the date of detention itself. Subsequently, the driver was also served with a show cause notice as required under Section 129 of the Act and proceedings were intitiated. The 1^st respondent contends that proceedings could not be completed on account of non-cooperation of the petitioner.

7. On the question of infraction of the provisions of the Act and the Rules, the 1^st respondent contends that the details of transport, obtained by the 1^st respondent, showed that the goods were moved from Hyderabad to Vijayawada, under an E-way bill generated at 9.16 P.M. on 02.11.2024 and subsequently, the 6^th respondent generated an E-way bill showing the movement of the goods from Vijayawada to Hyderabad at 9.18 P.M. on the same day.

8. The learned Assistant Government Pleader for Commercial Tax, appearing for the respondents, would contend that the goods could not have been moved in two minutes and subsequently, moved back to Hyderabad. The learned Assistant Government Pleader would also contend that there is a prima facie case of circular trading and movement of goods to evade payment of tax.

9. It is further contended tht the address given by the consignor, does not contain any godown, which is capable of storing 29,625 kgs of iron and steel scrap.

10. The learned counsel for the petitioner would contend that the iron and steel scrap was actually loaded in Autonagar at Vijayawada and not at the address of the office of the consignor.

11. There are clear disputes of fact, in as much as, the petitioner contends that no notices and proceedings were initiated under Section 129 of the Act, while the 1^st respondent contends that such notices were issued strictly within the ambit set out under Section 129 of the Act. Further, there is also a dispute as to the origin of the goods and whether the goods were loaded at Autonagar or they were said to have been loaded at the address of the consignor.

12. All these questions of fact, cannot be gone into by this Court in these proceedings. However, keeping in view, the time lines under Section 129 of the Act, this Court deems it appropriate to dispose of this Writ Petition, with a direction to the 1^st respondent to complete the proceedings, under Section 129 of the Act, expeditiously and preferably within a period of two (02) weeks from today. For the purpose of completing the enquiry, the petitioner or his authorised representative shall appear before the 1^st respondent on 26.12.2024, at 11.00 A.M. and put-forth his entire case. Thereafter, the 1^st respondent, after considering the written objections as well as any oral statements or grounds, raised by the petitioner or his authorised representative, shall take a decision, within the time frame set out above.

13. Accordingly, the Writ Petition is disposed of. There shall be no order as to costs.

As a sequel, interlocutory applications pending, if any, shall stand closed.