GST Penalty for E-way Bill Discrepancies Set Aside for Lack of Personal Hearing: Opportunity Granted for Explanation and Provisional Release of Goods
Summary:
The petitioner’s goods were detained due to discrepancies between the e-way bill destination (Gayathri Consultants, Tamil Nadu) and the actual unloading location (Sembiam Road, Kathirvedu). The petitioner was also unable to produce necessary documents like tax invoices and delivery challans for the movement of goods from Gayathri Consultants to Sembiam Road. A penalty was imposed under Section 129(1)(A) of the CGST/TNGST Act. However, the petitioner challenged the penalty order, stating that their request for a personal hearing was not granted. The court acknowledged this procedural lapse and disposed of the petition, directing the respondent to provide a personal hearing and pass a fresh order. The petitioner was allowed to submit a request for the provisional release of goods.
Facts of the Case:
- E-way Bill Discrepancy: The petitioner’s goods were intercepted because the e-way bill showed a different destination than where the goods were unloaded.
- Lack of Documentation: The petitioner could not produce supporting documents for the movement of goods from the declared destination to the actual unloading location.
- Penalty Imposed: A penalty was imposed on the petitioner under Section 129(1)(A) of the CGST/TNGST Act.
- Personal Hearing Denied: The petitioner’s request for a personal hearing was not granted before the penalty was imposed.
Decision:
- Personal Hearing Granted: The court directed the respondent to provide a personal hearing to the petitioner.
- Fresh Order: The respondent was instructed to pass a fresh order after the personal hearing, considering the petitioner’s submissions.
- Provisional Release of Goods: The petitioner was allowed to submit a request for the provisional release of their goods.
- No Opinion on Merits: The court did not express any opinion on the merits of the case, leaving it to the respondent to re-examine the matter.
This case highlights the importance of granting personal hearings in GST penalty proceedings, ensuring procedural fairness and allowing taxpayers an opportunity to explain their situation before a decision is made.
HIGH COURT OF MADRAS
Inland World Logistics (P.) Ltd.
v.
Deputy State Tax Officer
Mohammed Shaffiq, J.
W.P.No.35186 of 2024
W.M.P.No.38103 of 2024
W.M.P.No.38103 of 2024
DECEMBER 11, 2024
C. Baktha Siromoni, for the Petitioner. V. Prashanth Kiran, Govt. Adv. for the Respondent.
ORDER
1. The present writ petition is filed challenging the impugned order dated 09.11.2024 whereby the petitioner was directed to pay penalty of Rs.6,18,656/-as proposed in GST MOV 07 under Section 129(1)A of the CGST Act.
2. It is submitted by the learned counsel for the petitioner that the goods were inspected in terms of Section 68(3) of the Act and at the time of interception of the vehicle, the driver produced invoices and E-way bills. On scrutiny of E-way bills it was found that the goods was dispatched from Havells India, Rajastan to Gayathri Consultants, Tiruvallur, Tamil Nadu. However, it was found that instead of unloading at Gayathri Consultants at Tiruvallur the goods were being unloaded at Sembiam Road, Kathirvedu. The driver of the vehicle was not in a position to produce the documents for the movement of the goods from Gayathri Consultant to Sembiam Road, Kathirvedu and nor was there any tax invoices or delivery challan or E-way bill.
3. The petitioner appeared before the adjudicating officer on 29.10.2024 requested time to file his objections and for a personal hearing on 04.11.2024. The petitioner appeared on 04.11.2024 before the respondent and filed its reply wherein it was submitted that the goods relating to Ashok Leyland as well as Havells India were contained in the container and the goods relating to Havells India was loaded on top of the goods belonging to Ashok Leyland and thus Havells India goods were unloaded at Kathirvedu to enable the petitioner to unload the goods belonging to Ashok Leyland. However, the above reply was not found to be acceptable and the impugned order came to be passed.
4. It is the case of the petitioner that on 04.11.2024 while filing the reply they had sought for a personal hearing, however, no personal hearing was granted.
5. At this juncture the learned counsel for the respondent would submit that they would grant a personal hearing and pass orders afresh.
6. Recording the same, the writ petition is closed. The petitioner would appear for personal hearing at 18.12.2024 at 11.00 a.m. Orders would be passed afresh after considering the submission of the petitioner. It is submitted by the learned counsel for the petitioner that the goods may be provisionally released. It is open to the petitioner to make such request before the appropriate authority in accordance with law. If any such request is made the same would also be considered and orders would be passed in accordance with law. It is made clear that this Court has not expressed any views with regard to the merits of the case, it is open to the concerned respondent to consider the submission of the petitioner on its own merits and in accordance with law. There shall be no order as to costs. Consequently, connected miscellaneous petition is closed.