195 Seizure Section 129 vs Section 67

The petitioner stored the goods in a separate godown which, inadvertently, was not mentioned in the e-way bill- Penalty u/s 129 cannot be invoked for the seizure of the goods at the lying godown.

Hon’ble Calcutta High Court in Sandip Kumar Singhal Versus Deputy Commissioner, Revenue, Bureau of Investigation North Bengal Headquarter & Ors.

Facts and Issues Involved

Waybill was generated on 9th February 2022 for transporting fifteen thousand kilograms of cumin seeds and the same was valid up to 20 February 2022.

The goods were confiscated from a godown which the petitioner claims to be three kilometers ahead of the final destination point mentioned in the e-way bill on 22.02.2022.

The petitioner stored the goods in a separate godown which, inadvertently, was not mentioned in the e-way bill.

The godown in question from where the goods were seized is approximately three kilometers ahead, as claimed by the petitioner, from the final destination mentioned in the e-way bill.

Receipt evidencing taking the godown on rent for storage of the goods upon payment of charges has been produced in Court.

Revenue Department Contentions

The adjudicating authority opined that the goods were transported and stored while they were in transit.

Hon’ble Court Observations and Order

Under the Act, a specific form has to be applied in case of a particular offense. The nomenclature of the form is an indication of the offense committed by the RTP. Not issuing any order/notice in Form GST MOV makes it clear that the authority was satisfied that the goods were not in transit.

Admittedly, the goods were seized two days after the expiry of the e-way bill on being offloaded and stored in a godown not mentioned in the e-way bill. The e-way bill is for the purpose of moving/transporting goods from one place to the other. The law does not require a waybill to remain valid for such period as the goods remain in the godown.

The authority erroneously opined that as the goods were yet to reach the final destination mentioned in the e-way bill, accordingly, the same may be treated as ‘on transit’; for which the e-way bill ought to have been extended. The authority ought not to have imposed penalties without resorting to the proper provision.

The authority has also failed to make out a case that there was any connivance between the buyer and seller in dealing with the goods without payment of necessary taxes.

Authority invoked the provision of Section 67 but thereafter shifted stand and relied upon Section 68 read with Section 129 for the imposition of penalty. The authority was in a fix as to which provision to invoke for the imposition of penalty. At one point in time, the goods were held to be stored in the godown without the proper documents and without a valid e-way bill and immediately thereafter, the goods were held to be in transit. A single consignment of goods cannot be held to be stored in the godown and to be in transit, simultaneously, at the same time.

The petitioner was certainly at fault in not recording the additional godown at the time of generation of the e-way bill, but at the same time, the petitioner ought not to be penalized with a two hundred percent penalty for such a trivial offense. As the goods were not confiscated while on the move, imposition of penalty under Section 129 of the Act is erroneous and bad in law. The aforesaid section cannot be relied upon to penalize the RTP when the goods are seized from a godown.

In the case at hand it does not appear that the authority acted in accordance with the appropriate legal provisions and instead penalised the petitioner in a mechanical manner without proper application of mind.