Shiva Enterprises Vs State of U.P. And Another (Allahabad High Court)
Section 129 GST Timelines Held Directory as Law Prescribes No Consequence for Delay; GST Penalty Proceedings Not Invalid Merely Because Order Was Passed on Eighth Day; Allahabad HC Disagrees With Gujarat, Patna and Orissa High Courts on Mandatory GST Timelines; GST Detention Proceedings Upheld Because Delay Did Not Defeat Purpose of Statute: Allahabad HC
In , the writ petition before the Allahabad High Court challenged detention proceedings, notice, and penalty order issued under Section 129 of the CGST/UPGST Act in relation to transportation of walnuts from Bihar to Delhi through Uttar Pradesh.
The petitioner, a registered partnership firm in Bihar, claimed that the goods were being transported with valid tax invoice and e-way bill when the vehicle was intercepted on 10.02.2026. Physical verification was conducted on 14.02.2026, after which detention order in Form GST MOV-06 and show cause notice in Form GST MOV-07 read with DRC-01 were issued on 16.02.2026 proposing penalty under Section 129(1). The penalty order in Form GST MOV-09 was ultimately passed on 24.02.2026.
The principal challenge raised by the petitioner was that the proceedings were barred by limitation under amended Section 129(3) of the Act. It was argued that the provision mandated issuance of show cause notice within seven days from detention and passing of penalty order within seven days from service of notice. Since the order was passed on the eighth day from issuance of notice, the petitioner contended that the proceedings stood vitiated. Reliance was placed on judgments of the Supreme Court and various High Courts including Gujarat, Patna, Orissa, and Madras High Courts.
