Case Law Details
Amplus Kn One Power Private Limited Vs Assistant Commissioner State Tax And Another (Allahabad High Court)
The writ petition was filed under Article 226 of the Constitution of India challenging the seizure of goods and the show cause notice dated December 6, 2023 issued under Section 129 of the Uttar Pradesh Goods and Services Tax Act, 2017. The petitioner also sought refund of the penalty that had been paid under protest for release of the goods.
The basis for detention of the goods was that the address mentioned in the invoice was not the petitioner’s registered place of business at the time of detention. The petitioner contended that the address mentioned in the invoice was the project site where the work was being carried out. This factual position was not disputed, and the revenue was unable to place any material contrary to the petitioner’s contention. It was also noted that the said address was subsequently added as one of the petitioner’s places of business.
The petitioner relied upon the decision of the Allahabad High Court in Meghdoot Enterprises v. Additional Commissioner (Appeal), Central Goods and Services Tax and Central Excise, contending that penalty under Section 129 should not be imposed in the absence of an intention to evade tax.
The Court observed that the revenue had failed to indicate any mens rea or intention to evade tax. Consequently, the Court held that the detention proceedings, the resulting show cause notice, and the imposition of penalty lacked any legal basis.
Accordingly, the Court quashed and set aside the seizure and the show cause notice dated December 6, 2023. It further directed the revenue to refund the penalty already imposed and collected from the petitioner within eight weeks from the date of the order. The writ petition was disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Ms. Ashwini Chandrashekaran and Mr. Kushagra Agarwal, learned counsel appearing on behalf of the petitioner and learned Standing Counsel appearing on behalf of the State-respondents.
2. This is a writ petition under Article 226 of the Constitution of India wherein the writ petitioner is aggrieved by the seizure and the show cause notice dated December 6, 2023 issued by respondent no.1/Assistant Commissioner State Tax, Sector 2 Mobile Squad-1, Gautam Budh Nagar under Section 129 of the Uttar Pradesh Goods and Service Tax Act, 2017 (hereinafter referred to as “the Act”). The petitioner has further prayed for refund of the penalty that has been paid by the petitioner under protest for release of the goods.
3. Learned counsel appearing on behalf of the petitioner submits that the grounds for detention of the goods was the fact that the address given in the invoice was not the registered place of business of the petitioner at the time of detention. He submits that this particular address was the project site on which the work was being carried out by the petitioner. This factual aspect is not in dispute and the revenue has not been able to indicate anything which is contrary to the above factual aspects.
4. It is to be noted that this particular address was subsequently added as one of the business place of the petitioner.
5. Learned counsel appearing on behalf of the petitioner has relied on paragraph nos.6 and 7 of the judgement of Single Judge of this Court in Meghdoot Enterprises Vs. Additional Commissioner (Appeal), Central Goods and Services Tax and Central Excise reported in (2024) 19 Centax 408 (All.) [21-03-2024] to buttress his argument that unless there is an intention to evade tax, no penalty should be imposed under Section 129 of the Act.
6. In the present case, we find that the revenue has not been able to indicate any mens rea for evasion of tax, and therefore, the very process of detention leading to the show cause notice and the imposition of penalty is without any basis in law and is liable to be quashed and set aside.
7. In light of the same, the seizure and the show cause notice dated December 6, 2023 is quashed and set aside and the penalty imposed and collected by the revenue is directed to be refunded to the petitioner within a period of eight weeks from date.
8. The writ petition is disposed of.
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