The main legal point established in the judgment is the requirement to follow the procedural provisions under Section 129 before invoking the order of confiscation under Section 130 of the SGST Act, 2017.

ORDER :

C.PRAVEEN KUMAR, J.

The present Writ Petition came to be filed, seeking issuance of Writ of Mandamus, declaring the action of the respondent no.1 in passing the “Order of Confiscation of Goods and Conveyance and Demand of Tax, Fine and Penalty” vide proceedings, dated 22.09.2021, under Section 130 of the State Goods and Service Tax Act, 2017 [for short, “SGST Act, 2017”], as violative of Sub- Sections (3) and (6) of Section 129 and of Sub-Section (4) of Section 130 and the Rules made thereunder.

2. The facts, which led to filing of the present Writ Petition, are as under:-

(a) The petitioner herein is doing business in purchase and sale of all kinds of scrap such as Battery, Alluminium Scrap, Brass Scrap and Copper Scrap. It is said that the petitioner used to purchase scrap from petty shops and small traders in loose quantity, put it together until it weighs 10 or 11 tonnes and then sell the same to dealers in Kurnool and Anantapur Towns. The petitioner’s annual turnover is around 20 to 30 Lakhs. It is said that at the time of rollout of the GST regime, the petitioner was instructed by the GST Officers that no registration is required for business entities having an annual sale turnover of 40 Lakhs. Hence, the petitioner is doing business without obtaining any registration.

(b) While things stood thus, on 10.09.2021, the petitioner who procured scrap from various petty dealers, loaded the same in a vehicle bearing No. AP 02 TC 7299 and was proceeding towards a weigh bridge for weighment of the goods. When the said vehicle along with the scrap was on its way to the weigh bridge, the respondent no.1 herein is said to have stopped the vehicle and issued orders, for physical verification, in Form GST MOV-02, dated 10.09.2021. The said form came to be issued mainly on the ground that the petitioner transported the goods without any way bills. On physical verification, it was found that the petitioner was carrying 11,989 Kgs of scrap material. After issuance of physical verification report, the respondent no.1 issued “Order of Detention” of the vehicle and thereafter on the very next day, the respondent no.1 issued notice, for confiscation of the goods and accordingly proposals were sent, for levying penalty and fine.

(c) The petitioner claims to have submitted his letter setting out reasons as to how the authorities erred in levying the tax. However, the order impugned came to be passed on 22.09.2021, ordering confiscation of the goods and conveyance. Exercising the power under Section 130 of SGST Act, 2017, the material along with vehicle came to be confiscated. It was further informed to the petitioner that all goods should be released on payment of tax, penalty and fine within 45 days from the date of said order.

3. Assailing the same, the present Writ Petition came to be filed, mainly contending that the order impugned, came to be passed without giving an opportunity of hearing the petitioner.

4. A counter came to be filed by the respondents disputing the averments made in the affidavit, filed in support of the Writ Petition. It is said that the driver of the vehicle did not carry any documents and as per the provisions enshrined in Section 68 r/w. Rule 138A of SGST Act and the Rules therein, a copy of e-way bill should accompany the goods.

(a) It is further stated that the goods vehicle was intercepted on the highway at Tapovanam, and the plea taken by the petitioner that it was being intercepted while it was going towards weigh bridge, is incorrect. It is further stated in the counter that the provisions of Rule 138(1) of SGST Rules, 2017 only speaks about the obligation vested upon the registered person to generate e-way bill who causes the movement of goods consignment value exceeding Rs.50,000/- and that it does not prohibit carrying e-way bill by the unregistered person.

(b) It is further stated that the case on hand is one of confiscation of goods under Section 130 of SGST Act, 2017 and not a case of levy of tax on asse