Minor deviations in transport routes without intent to evade tax do not warrant harsh penalties; authorities should impose general penalties for trivial lapses in compliance with the Goods and Services Tax laws.

ORDER :

S.R.KRISHNA KUMAR, J.

In this petition, petitioner seeks for the following reliefs:-

“ i) Issue a writ of Certiorari or direction in the nature of a Writ or certiorari quashing the order passed by the Respondent No.1 in Form GST-APL-4, bearing Appeal No. IGST/122/2022-23 dated: 22.12.2023 under Section 107(11) of the KARNATAKA GOODS AND SERVICES TAX ACT , 2017 and Central Goods and Services Tax Act, 2017 herein marked as Annexure-A.

ii) Issue a writ of Certiorari or direction in the nature of a Writ or certiorari quashing the penalty order passed by the Respondent No.2 levying penalty on the petitioner in FORM GST MOV 09 bearing No. CTD/CENR/- 10MNG/VIG-10/2022-23 dated: 01.02.2023 herein marked as Annexure-B.

iii) And pass such other orders as this Hon’ble Court deems fit and proper in the interest of justice and equity.”

2. Heard learned counsel for the petitioner and learned AGA for the respondents and perused the material on record.

3. A perusal of the material on record will indicate that the petitioner /consigner purchased the subject goods from M/S.VRKP Sponge and Power Plant LLP, Bellary, who raised Tax invoice, E-invoice and e-way bill dated 29.01.2023 and entrusted the subject goods to a transporter to transport the same in vehicle No.KA-20 AB-4986 from Bellary to the premises of the petitioner at No.48, Kannur, Mangalore. The subject goods were loaded on to the vehicle on 29.01.2023 and left for its destination at Kannur, Mangalore, duly accompanied by Tax invoice, E-invoice, e-way bill and other documents. It is contended that the driver of the vehicle inadvertently and without any malafide intention missed the route and drove the subject vehicle and goods to Moodabidire on 31.01.2023, when he stopped by the roadside for the purpose of having refreshments, at that time, the 2^nd respondent intercepted the vehicle and inspected the same and recorded the statement of the driver by issuing Form-GST MOV-01 dated 31.01.2023, pursuant to which, physical verification of the conveyance and goods were conducted, resulting in issuance of notice under Section 129 (3) of the KGST Act by the 2^nd respondent, who detained the conveyance and goods.

4. The petitioner filed his objections dated 01.02.2023 interalia disputing the allegations made by the respondents that there was a deviation in the route by the vehicle and goods, in pursuance of which, the impugned penalty order dated 01.02.2023 was passed by the 2^nd respondent against the petitioner who made payment and filed an appeal before the 1^st respondent – appellate authority who dismissed the appeal by passing the impugned order dated 22.12.2023, aggrieved by which, petitioner is before this Court by way of the present petition placing reliance upon the Circular No.64/38/2018 – GST dated 14.09.2018 issued by the respondents in relation to procedure for interception of conveyances for inspection of goods in movement, detention, release and confiscation of such goods and conveyances etc., as well as the following judgments;

(i) The Joint Commissioner of Commercial Tax vs. M/s.Transways India Transport – W.A.No.854/2022 dated 24.06.2024;

(ii) Kamalesh Steels vs. Deputy State Tax Officer – (2021) 123 taxmann.com 375 (Telengana);

(iii) R.K.Motors vs. State Tax Officer – (2019) 102 taxmann.com 337 (Madras).

5. Per contra, learned AGA for the respondents submits that there is no merit in the petition and that the same is liable to be dismissed.

6. Before adverting to the rival contentions, it would be necessary to extract the aforesaid Circular dated 14.09.2018, which reads as under:-

Circular No. 64/38/2018-GST

CBEC/2016/03/2017-GST

Government of India

Ministry of Finance

Department of Revenue

Central Board of Indirect Taxes and Customs

GST Policy Wing

***

New Delhi, Dated the 14^th September, 2018

To,

The Principal Chief Commissioners / Chief Commissioners / Principal Commissioners / Commissioners of Central Tax (All)/The Principal Directors General /Directors General (All)

Madam/Sir,

Subjec