The imposition of penalties for minor discrepancies in tax-related documents without intent to evade tax is not justified under the CGST/SGST Acts.

1. The petitioner is an entity engaged in the transportation of goods. It has an agreement with M/s. Tata Motors Limited for transportation of commercial and passenger vehicles and chassis, which are driven to various destinations as required by that Company. On the request of M/s. Tata Motors Limited, the petitioner, transported a new tipper lorry (the goods) from Tamil Nadu to Kozhikode, Kerala. The said vehicle was intercepted and detained by the Assistant State Tax Officer of the Kerala GST Department, and a show cause notice was issued on 09/07/2019 at 12.20 p.m. It was found that the e - way bill had expired on 08/07/2019. Since the vehicle was detained, the petitioner moved this Court through W.P.(C)No.19284/2019 and the lorry was directed to be released on production of bank guarantee. Following the directions of this Court, the notice was adjudicated and Ext.P3 order was issued on 16/08/2019, imposing a penalty of Rs.5,24,017/- on the petitioner along with a demand for IGST for the same amount making a total demand of Rs.10,48,034/- on the petitioner. The petitioner preferred Ext.P4 appeal against Ext.P3 order under S.107 of the Central Goods and Services Tax Act / State Goods and Services Tax Act (hereinafter also referred to as the 'CGST / SGST Acts' or as 'GST Law'). The appeal filed by the petitioner as Ext.P4 has been returned, stating that the appeal cannot be entertained as the petitioner had not paid any admitted tax, and there is no predeposit of 10% of the disputed tax. It was also pointed out that stamp paper equivalent to 1% of the disputed tax is not remitted towards the legal benefit fund.

2. The learned counsel for the petitioner would contend that there was no warrant for imposing any penalty on the petitioner in the facts and circumstances of the case. It is submitted that there is no suppression or evasion of tax. It is submitted that the e - way bill was valid up to 11.59 p.m. on 08/07/2019, and the vehicle was intercepted the next day. It may be noted here that though the writ petition proceeds (based on the endorsement in Ext.P1), that the vehicle was intercepted at 12.20 a.m. on 09/07/2019, it is clear from a reading of Ext.P3 that the detention was at 12.20 p.m. on 09/07/2019. It is pointed out by the learned counsel that the vehicle had failed to cross the check post on 08/07/2019 itself because it developed some mechanical problems on its way to Kozhikode and had to be taken to a workshop and also since the Bandipur Highway was closed during night hours. He also relied on Ext.P6 judgment of this Court to contend that for minor discrepancies, a major penalty cannot be imposed. He also relied on the judgment of the Madras High Court in WMP (MD) No.4567/2020 to contend that where there is only a technical breach and no intention to evade tax, there is no justification for imposing a heavy penalty under the GST laws. He also relied on the judgment of the Madhya Pradesh High Court in W.P No.6118/2021 to contend that where there is only a bonafide mistake in the e - way bill, only a minor penalty can be imposed. The judgments of the Madras High Court and Madhya Pradesh High Court are produced as Exts.P7 and P8 along with the writ petition. The learned counsel appearing for the petitioner placed considerable reliance on the judgment of a Division Bench of the Telangana High Court in M/s. Satyam Shivam Papers Pvt. Ltd. & Another v. Asst. Commissioner (ST) and others; 2021 SCC OnLine TS 698 : (2021) 50 GSTL 459. It is submitted that the fact situation, in this case, is almost identical to the fact situation considered by the Telangana High Court. It is pointed out that there also the validity of the e - way bill had expired just before the detention and that on a cons