Court No. - 6

Case :- WRIT TAX No. - 1464 of 2022

Petitioner :- S/S S.K. Trading Co And Another

Respondent :- Additional Commissioner Grade 2(Appeal )

And Another

Counsel for Petitioner :- Bipin Kumar Pandey,Aditya Pandey

Counsel for Respondent :- C.S.C.

Hon'ble Pankaj Bhatia,J.

Heard learned counsel for the petitioner and learned Standing

Counsel for the respondents.

Present petition has been filed by the petitioners with the

allegations that petitioner no.1 placed an order for supply of

mixed ready-made garments, which were being transported by

petitioner no.2. It is stated that on 13.09.2022 the goods while

in transit were intercepted and a physical verification report was

prepared on 17.09.2022 in form GST MOV-04 and no

discrepancy was found in the quantity of the goods in question.

It is stated that on 21.09.2022, a detention order was passed

detaining the goods in question mainly on the ground that the

goods were without E-Way bill. It is argued that although under

Section 129(3) of U.P. GST Act (hereinafter referred to as 'the

Act'), there is a prescription for issuance of a notice in Form

GST MOV-07, however, the notice was not issued in the format

as prescribed but was issued by an authority whose name is not

even specified as the order itself recorded that the same was

issued for the authority and not by the authority.

It is stated that in reply to the letter issued to the petitioner, the

petitioner filed a detailed reply denying the allegations which

led to passing of an order dated 26.09.2022 (Annexure - 6).

Aggrieved against the said order, the petitioner preferred an

appeal which too was dismissed by means of an order dated

19.10.2022. The said two orders are under challenge in the

present petition.

Contention of learned counsel for the petitioner is that in the

event Part - B of the E-Way Bill was not being carried, no

penalty is imposable. He further argues that in any event, the

detaining authority does not have the jurisdiction to value the

goods as has been done. In support of the same, he places

reliance on the Circular dated 09.05.2018.

In the light of the said two submissions, learned cousnel for the

petitioner argues that the order imposing the penalty that too on

valuation without jurisdiction is wholly bad in law.

He further argues that even for the sake of arguments, it is

presumed that the petitioner is liable, the provisions of Section

129(1)(a) of the Act can be attracted in this case and not Section

129(1)(b) of the Act as admittedly the petitioner is the owner of

the goods in terms of the invoice issued in favour of the

petitioner. He further argues that it is well settled that if the

petitioner is either a consignor or a consignee, he has to be

treated as a owner of the goods and thus, the provisions of

Section 129(1)(b) of the Act are not invokable as has been done

by the department.

In view of the said submission, he places reliance on the

judgment of this Court in the case of M/s Riya Traders v. State

of U.P. & Ors.; Writ Tax No.28 of 2023 decided on 17.01.2023

as well as in the case of M/s Margo Brush India and Others v.

State of U.P. & Anr.; Writ Tax No.1580 of 2022 decided on

16.01.2023. This Court in Para - 3 of the judgment in the case

of M/s Margo Brush India (supra) has held as under:

"3. The argument is that it is a case in which the goods in transit were

accompanied by proper documents. When show cause notice was issued to

the driver of the vehicle, the petitioners had filed their replies. In terms of

the provisions of Section 129(1)(a) of the Act, in case, the owner of the

goods comes forward, the penalty is to be levied upon him. The penalty

can be levied under section 129(1)(b) of the Act, only if the owner of the

goods does not come forward. In the case in hand, vide impugned order

the penalty has been levied under Section 129(1)(b) of the Act, which is

not applicable. He has also referred to Circular dated December 31, 2018

issued by