The central legal point established in the judgment is the requirement of intent to evade tax for the imposition of penalties under the UPGST Act, 2017, and the CGST Act, 2017.

JUDGMENT :

1. The instant writ petition has been filed by the petitioner, M/s Falguni Steels praying for the issuance of a writ of certiorari against the order dated February 21, 2019 passed by the Assistant Commissioner, Commercial Tax, (Mobile Squad), Unit – II, Prayagraj (hereinafter referred to as ‘Respondent No. 2’) and the order dated October 20, 2019 passed by the Additional Commissioner, Grade -2, (Appeal) -I, Commercial Tax, Prayagraj (hereinafter referred to as ‘Respondent No. 3’).

Facts

2. Factual matrix of the instant case has been laid down below:

a. The petitioner is an authorized dealer of the Steel Authority of India Ltd. (hereinafter referred to as ‘SAIL’). On February 17, 2019, the petitioner purchased a consignment of TMT Bar under the Tax Invoice Nos. OS0020005822 & OS0020005823. The said tax invoices were issued by SAIL in accordance with the provision of Section 31 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘CGST Act, 2017’) read with Rule 46 of the Central Goods and Services Tax Rules (hereinafter referred to as the ‘CGST Rules, 2017’).

b. Thereafter, the petitioner obtained the service of a private road carrier for the transportation of its goods through vehicle bearing registration No. UP-70-AT-3747 from SAIL Yard, Naini, Allahabad, to Falguni Steels, Lookerganj, Allahabad. The tax invoices contained the number of the said vehicle.

c. The petitioner alleges that during the relevant time, the e-Way Bill portal of the Department was marred by glitches and technical shortcomings and owing to the said fact, e-Way Bills on several occasions could not be generated by the Transporters/Consignors/Consignees.

d. Owing to the above stated glitch, e-Way Bills could not be generated by the time of the onset of the transportation of the Good. The said e-Way Bills were generated on February 20, 2019 (No. 47051859886) and February 21, 2019 (No. 481051862043). The petitioner states that the said e-Way Bills were presented before the Respondent No. 2 at the time of the interception of the goods and before the issuance of the Show Cause Notice as well as passing of the order under Section 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘UPGST Act, 2017’). However, the said e-way Bills were not taken into consideration by the Respondent No. 2.

e. The supplier SAIL had generated Invoices Nos. OS0020005822 and OS0020005823, both dated February 17, 2019 wherein the quantity, description of goods and the vehicle number were mentioned. The petitioner states that the transportation of the goods on the same day was not possible due to the barrier imposed by the local administration for transportation, due to the occasion of “Maghi Purnima, Kumbh Mela, 2019”. These goods were transported on February 20, 2019 from SAIL Yard, Naini to Lookerganj, Allahabad.

f. Show Cause Notice (FORM GST MOV-07) was issued to the petitioner under Section 129(3) of the UPGST Act, 2017 on February 21, 2019 alleging that the movement of the goods was in contravention to the provisions of the UPGST Act, 2017. The said Show Cause Notice required the petitioner to show cause as to why tax of an amount of INR 1,29,862/-along with an equivalent penalty of INR 1,29,862/- ought not to be recovered from it.

g. The petitioner, thereinafter, deposited the amount of INR 2,59,724/-through CPIN No. 19020900359828 dated February 21, 2019 via Reserve Bank of India towards tax and penalty, after which, the Respondent No. 2, released the goods in favor of the petitioner.

Aggrieved by the order dated February 21, 2019, passed by the Respondent No. 2, the petitioner preferred a statutory appeal before the Respondent No. 3.

h. Respondent No. 3, vide its order dated October 20, 2019, which was passed under Section 107 of the UPGST Act, 2017, upheld the order dated February 21, 2019, passed by the Respondent No. 2 and confirmed the tax liability and penalty, imposed by the Respondent No. 2.

i. Aggrieved