GST Caselaw

#GSTCase-49-Gist of Cases on E-Way Bill-Validity of E-way Bill Expired during movement of Goods

#GSTCase-49-Gist of Cases on E-Way Bill-Validity of E-way Bill Expired during movement of Goods

 

Cases Covered

Case-1: Sarvottam Rolling Mills (P.) Ltd. v. State of U.P. [2019] 101 taxmann.com 127 (Allahabad)

Case-2: Timexo Fasteners India (P.) Ltd. v. State of U.P. [2018] 100 taxmann.com 277 (Allahabad)

Case-3: Malabar Steel Industries v. Assistant State Tax Officer, Karukutty [2018] 99 taxmann.com 316 (Kerala)

Case-4: Chaithanya Granites & Marbles v. Assistant State Tax Officer [2018] 100 taxmann.com 84 (Kerala)

Case-5: Kitex Garments Ltd. v. Assistant State Tax Officer [2018] 99 taxmann.com 309 (Kerala)

 

Case-1: Sarvottam Rolling Mills (P.) Ltd. v. State of U.P. [2019] 101 taxmann.com 127 (Allahabad)

Issue Involved: Expiry of Validity Period of E-Way Bill

Facts: The goods of the petitioner, which were coming from Muzaffarnagar to Hapur, were seized under section 129(1) of the Uttar Pradesh Goods Services Tax Act, 2017 for the reason that the E-Way Bill had expired.

 Contention of the Applicant: E-Way Bill had expired in the midnight on 21.11.2018 and goods were seized one hour after the expiry of the said time. The goods had reached at the destination in time but on account of no entry, the vehicle could not enter into the city. In the meantime, the detention order was passed. 

 Held: The seized goods and the vehicles be released forthwith on furnishing security in the form of bank guarantee of the amount equivalent to that as prescribed under section 129(1) of the U.P. GST Act. With the aforesaid observation, the writ petition stands disposed off.

 

Case-2: Timexo Fasteners India (P.) Ltd. v. State of U.P. [2018] 100 taxmann.com 277 (Allahabad)

Issue Involved: Expiry of Validity Period of E-Way Bill

Facts: The petitioner purchased fencing wire on 05.11.2018 from the Sharp Engineers, Delhi. and were to be delivered at Kanpur. Invoice/Bilty was generated on 05.11.2018 and goods were dispatched from Delhi through transport on 05.11.2018 along with e-way bill which was valid upto 12 p.m. of 10.11.2018.

Vehicle and goods were intercepted at Kanpur during the intervening night of 10/11.11.2018 and after the statement of the person incharge of the vehicle was recorded at 11:36 a.m., on the next date ie. 11.11.2018 a seizure order under Section 129 (1) of the Goods and Services Tax Act, 2017 (in short of the Act) was passed solely on the ground that the e-way bill accompanying the goods had expired.

Contention of the Petitioner: Truck Vehicle No. UP 78/ CN 5278 carrying the said consignment had left Delhi on 05.11.2018 and had reached Kanpur along with all documents including e-way bill well within time by 8 p.m. of 10.11.2018. The very basis of the seizure of the goods is non-existing as at the time of interception of the goods e-way bill accompanying the goods was very much valid and that only on account of delay in the issue of the memo of seizure, the time mentioned in the e-way bill expired. The seizure memo incorrectly mentions the time of interception of the goods.

Contention by the Respondent: Special counsel appearing for the respondents was given time to seek instructions as to the time when vehicle in question had entered Kanpur and was actually intercepted notwithstanding the issuance of the seizure memo on 11.11.2018. As per Instruction received, vehicle was checked at 12:30 in the night of 10/11.11.2018 at Jarib Chowki, Kanpur by which time the e-way bill had expired. The vehicle was brought to the office at 1:30 a.m. on 11.11.2018 whereupon memo of seizure was issued at 11:30 a.m., on 11.11.2018 itself whereas the release order was issued on 12.11.2018.

Held: The averments regarding the entry of vehicle in Kanpur and the intercepting of goods as made in the writ petition have not been countered by the official of the department through the above instructions. It only states that the vehicle was checked at 12:30 in the night of 10.11.2018 at Jarib Chowki, Kanpur without uttering a single word as to when the vehicle is said to have been entered Kanpur Nagar despite fact that the specific direction was issued to the respondent to seek instructions about it.

In the above circumstances and the fact that the petitioners alleged that the vehicle with the goods had entered Kanpur at 8.00 p.m. on 10.11.2018 much before the period mentioned in the e-way bill had expired which fact remains unanswered in the instructions, we are of the opinion that the seizure of the goods on the ground that accompanying e-way bill had expired is not justified rather it was allowed to expire after the detention of the goods by incorrectly recording the time of interception. Accordingly, the order of seizure dated 11.11.2018 issued under Section 129(1) of the Act (Annexure-1) to the writ petition is quashed and the seized goods along with the vehicle are directed to be released forthwith in favour of petitioner No.2.

 

Case-3: Malabar Steel Industries v. Assistant State Tax Officer, Karukutty [2018] 99 taxmann.com 316 (Kerala)

Issue Involved: Expiry of Validity Period of E-Way Bill

Facts: The petitioner, a dealer under the CSGST Act, sold goods as seen from Ext.P1 invoice. The vehicle and the goods were detained because the validity of the Ext.P2 e-way bill expired and the invoice number was allegedly manipulated. Aggrieved, the petitioner filed this writ petition.

Held: The learned Division Bench of this Court in Renji Lal Damodaran v. STO [2018] 97 taxmann.com 677 (Ker) dealt with an identical issue. Applying the ratio of that judgment, I direct the respondent authorities to release the petitioner’s goods and vehicle on his “furnishing Bank Guarantee for tax and penalty found due and a bond for the value of goods in the form as prescribed under Rule 140(1) of the CGST Rules”. With the above direction I dispose of the writ petition.

 

Case-4: Chaithanya Granites & Marbles v. Assistant State Tax Officer [2018] 100 taxmann.com 84 (Kerala)

Issue Involved: Expiry of Validity Period of E-Way Bill

Facts: The petitioner purchased goods from a company in Maharashtra. It generated e-way bills and entrusted the goods to a parcel agency to be transported to Kerala.When the goods reached Surathkal, Karnataka, first, the vehicle broke down and required repairs. Once the vehicle got repaired on 13.08.2018; the transporter wanted to resume the journey. But in the meanwhile, the State of Kerala was caught in an unprecedented flood. To reach Edapally, Ernakulam, the transporter had no motorable road because most roads, by then, were inundated-even breached. The transport thus took more than usual time to reach Edapally. By then, the e-way bill had expired. In that background, the respondent authorities intercepted the vehicle at Kasaragod and detained the goods under Section 129 of the GST Act. Later, after failing in its effort to have the interim custody of the goods, the petitioner has filed this Writ Petition.

Held: The record bears out that the e-way bill generated on 01.08.2018 was valid up to 18.08.2018. Undeniably, the petitioner’s vehicle, broke down at Surathkal in Karnataka and was ready only on 13.08.2018. If it had begun the journey the next day, by 15.08.2018; it must have been passing through Kerala the next day. But by 16.08.2018 the flood situation in Kerala worsened. Perhaps, the transporter must have played safe and waited for the roads to clear. And that did not immediately happen. The petitioner has every document to transport the goods safely, save the expiry of the time prescribed in the e-way bill. It is preposterous to contend that the petitioner delayed the transport deliberately-for no purpose.

Granted, I cannot find fault with the authorities in detaining the goods. But once the petitioner has explained the circumstances, they ought to have taken a lenient view-rather a practical view, at that. Under these circumstances, I dispose of the writ petition, holding that the respondents will release the goods after securing personal bond from the petitioner-that is, without insisting on the bank guarantee. This arrangement, I clarify, will not affect the adjudication under Section 129 of the Act.

 

Case-5: Kitex Garments Ltd. v. Assistant State Tax Officer [2018] 99 taxmann.com 309 (Kerala)

Issue Involved: Expiry of Validity Period of E-Way Bill

Facts: The Petitioner imported some raw material from Switzerland and had it cleared on 1.10.2018 by the customs authorities. On 1.10.2018, the petitioner generated the e-way bill at 5.52 pm. After generating that bill, it had the goods loaded into a transport vehicle at the Container Freight Station of the Customs Department at Vallarpadam. But it could not transport them during night hours. The next day, 2nd October, was a holiday. So it could transport the goods only on 3.10.2018 at 10.40 am. The goods in transit, on 03.10.2018 at 11.15 am., the respondent authorities intercepted the transport and detained the vehicle, under Section 129 of the SGST Act. They demanded tax of Rs. 11,36,221.56, besides the penalty of an equal amount. The cause for detention was that the e-way bill had expired.

Contention by the Department: On the other hand, Dr. Thushara James has drawn my attention to Section 129, besides other provisions of KGST Act. According to her, the petitioner under Rule 138 (10) had the option of having the time extended. Time extended, it could have reloaded the e-way bill. At any rate, she has strenuously opposed any judicial intervention because once the statutory conditions stand diluted, she continues, it would provide a weapon for the tax evaders. She has also stressed that the respondent authorities following the procedure to a perfection cannot be castigated as hyper-technical. That said, the Government Pleader submits that, the petitioner may have faced a genuine difficulty. If this Court intervenes at this stage, it may become a precedent, throwing the departmental actions out of gear. Instead, she suggests an alternative: this Court may set aside and remand the matter to the Assistant State Tax Officer, who will consider the issue afresh, especially, keeping in view the petitioner’s explanation. She further assures the Court that the ASTO will pass orders within 24 hours, once the petitioner approaches him.

Held: Without adverting to the merits, I dispose of the writ petition settting aside the Ext.P10. I further clarify that the petitioner can approach the ASTO tomorrow. On the petitioners’ approach, the authority will reexamine the issue, keeping in view the petitioner’s Ext.P9 explanation and the other materials, and pass orders on the same day. The writ petition stands disposed of.

 

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