Goods Or Conveyance Can't be Detained Without Service of detention Order: Jharkhand High Court

The division bench of Justice Aparesh Kumar Singh and Justice Deepak Roshan has observed that the adjudication order and the appellate order both suffered from procedural infirmities and lacked proper opportunity for the person transporting to defend himself.

The alleged violation of Section 129 of the CGST Act, 2017 read with Rule 68 as the E-Way bill had expired at 11.59 p.m. on September 17, 2021, the vehicle bearing was intercepted at 08:20 a.m. on September 18, 2021. However, the entire proceedings starting from the detention of the vehicle by issuance of Form GST MOV-06, show-cause notice in Form GST MOV-07 and the adjudication order in Form GST MOV-09 were passed on the same date, i.e., September 20, 2021. The petitioner went on appeal before the Joint Commissioner (Appeals) but lost there also. The petitioner deposited the entire tax amount with interest and got the vehicle released on September 21st, 2021.

The petitioner submitted that the entire proceedings be held ex parte. No proper opportunity of furnishing a reply or hearing was accorded to the petitioner or his driver. There was no intention to evade tax. The vehicle was seized in the teeth of Section 129(1) of the CGST Act.

The department contended that notice with seven days' time to submit a reply was served on the authorised person of the company on September 20, 2021, who was also directed to appear at 11: 30 a.m. but he did not appear. On the request of the taxpayer, the vehicle was released on payment of tax and interest as they did not want to submit anything on the issue. Therefore, the case was adjudicated ex parte. The vehicle has been released.

The department contended that the provisions of Section 129 do not contemplate the requirement of an intention to evade tax for imposing liability for tax, interest, and penalty. Therefore, the adjudication order dated September 20, 2021 and the appellate order dated February 17, 2022 do not suffer from any legal infirmity. The proceedings were expedited at the request of the taxpayer himself.

The court held that the proceedings had been initiated on the same date and concluded on the same date. The order dated September 20, 2021, issued on Form GST MOV-09, and the appellate order dated February 17, 2022, were set aside.

Case Title: M/s. AMI Enterprises Pvt. Ltd. Versus Union of India

Case No: W.P. (T) No. 2312 of 2022

Citation: 2022 LiveLaw (Jha) 81 

Dated: 10.08.2022

Counsel For Petitioner: Advocate Amrita Sinha

Counsel For Respondent: Advocate Amit Kumar

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