Case Law Details
Additional Director General of the Directorate General of GST Intelligence DGGI Vs Sarvadeva Vanijya Pvt Ltd And Ors (Gauhati High Court)
The Gauhati High Court dismissed an application filed by the Directorate General of GST Intelligence (DGGI) seeking modification of an interim order relating to release of a consignment of areca nuts and transport vehicles. Earlier, by order dated 22.01.2026 passed in the connected writ petition, the Court had directed release of the areca nuts and vehicles upon furnishing of an adequate bank guarantee equivalent to the alleged short-paid tax amount of Rs.4,52,076/-, comprising CGST and SGST components. The DGGI sought alteration of the interim order on the ground that the Court had considered only the amount of tax short paid and had not taken into account the penalty component, which according to the Department increased the total liability to Rs.99,45,656/-. The Department argued that the bank guarantee amount should therefore be proportionately enhanced.
The writ petitioner opposed the application, contending that the Court had already been informed about the penalty component through the communication dated 22.12.2025 and had consciously directed furnishing of a bank guarantee only for the alleged short-paid tax. It was also submitted that despite filing the modification application, the interim order directing release of the perishable goods had not been complied with.
After hearing the parties, the High Court observed that while passing the interim order dated 22.01.2026, it had considered the amount of tax allegedly short paid. The Court acknowledged that the annexed communication also contained details of penalty calculation but held that the primary purpose of the interim protection was to secure the amount of tax allegedly due. The Court further noted that the goods involved were admittedly perishable in nature and found no justification for modifying or altering the interim order. At the same time, the Court clarified that if the petitioner ultimately failed in the writ petition, the Department would retain the right to enforce the penalty component in accordance with law.
The Court, however, partially modified the earlier order to the limited extent that the bank guarantee directed to be furnished would now be submitted in the name of the Additional Director General of the DGGI instead of the respondent no. 2. With this clarification, the interlocutory application was disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF GAUHATI HIGH COURT
Heard Shri SC Keyal, learned Senior Standing Counsel, DGGI for the applicant. Also heard Dr. A. Saraf, learned Senior Counsel assisted by Shri A. Kaushik and Shri B. Sarma, learned counsel for the opposite party / writ petitioner.
2. By the instant application, a prayer has been made for modification / alteration of the order dated 22.01.2026 passed in the connected writ petition being WP(C)/318/2026. By the aforesaid order dated 22.01.2026, this Court had passed an interim direction providing that subject to furnishing of adequate bank guarantee before the respondent no. 2 to cover the demand of tax short paid namely, Rs.2,26,038/- respectively for CGST and SGST totaling to Rs.4,52,076/- by the petitioner, the consignment of the areca nuts along with the vehicle Nos. WE65EB0086 and AS23BC9796 be released forthwith. The primary ground of filing this application is that while passing such interim order, the Court had taken into consideration only the amount of tax short paid and not the penalty involved.
3. By drawing the attention of this Court to the order dated 22.12.2025 issued by the Assistant Director, Shri Keyal, learned Standing Counsel has submitted that the same would indicate that there is a component of penalty and the total amount would be Rs.99,45,656/-. He accordingly submits that to balance the equities and secure the end of justice, the amount of the bank guarantee should be increased proportionately. He has submitted that in principle, he is not opposed to the aspect of releasing of the goods which are admittedly perishable in nature.
4. Dr. Saraf, learned Senior Counsel for the opposite party / writ petitioner has however submitted that while passing the interim direction on 22.01.2026, this Court was apprised of the penalty component which clearly appears from the communication dated 22.12.2025 (Annexure 10 of the writ petition). After such consideration, to secure the amount of tax involved, the present interim order has been passed directing furnishing of a bank guarantee of an amount equivalent to the tax allegedly short paid. He has also informed that in the pretext of filing the IA, the interim order which was passed inter-parte has not been complied with till date.
5. Upon hearing the learned counsel for the parties, this Court has observed that while passing the interim order dated 22.01.2026, this Court had taken into consideration the amount of tax short paid which is Rs.4,52,076/-. Though, this Court has also noted that Annexure 10 to the writ petition which contains the calculation in a tabular form also constitutes the penalty amount, in the considered opinion of this Court, the primary purpose is to secure the amount of tax short paid as alleged by the Department. Accordingly, this Court is of the opinion that the interest of justice has been taken into consideration and on being prima facie satisfied, the interim order has been passed, more so, when the goods involved are admittedly of perishable nature. This Court is accordingly of the opinion that no case for modification / alteration of the interim order is made out.
6. It is needless to state that that in the event the petitioner fails in the writ petition, the Department will have all the rights to enforce the penalty aspect.
7. At this stage, Shri Keyal, learned Senior Standing Counsel has submitted that the bank guarantee should be submitted before the respondent no. 3 – Additional Director General of the DGGI. The interim order dated 22.01.2026 is accordingly modified to the extent of the bank guarantee, as directed vide the order dated 22.01.2026 be furnished in the name of the respondent no. 3 instead of the respondent no. 2.
8. A. accordingly stands disposed of.
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