Case Law Details
Hindustan Herbal Cosmetics Vs State of U.P. And 2 Others (Allahabad High Court)
Introduction: The Allahabad High Court, in the case of Hindustan Herbal Cosmetics vs. State of U.P. and 2 Others, delivered a crucial judgment emphasizing that a typographical error in an E-Way bill should not attract a penalty if there is no intent to evade tax. The petitioner, a registered dealer under the Goods and Service Tax Act, challenged the penalty imposed by tax authorities for an E-Way bill error, contending it was a typographical mistake with no intention to evade tax.
Detailed Analysis: The petitioner, a cosmetics seller, supplied goods to another registered dealer in Jharkhand, supported by a tax invoice, bilty, and E-Way bill, all dated May 23, 2018. However, during transit, authorities intercepted the vehicle, citing an error in the E-Way bill, where the vehicle number was incorrectly mentioned as DL1 AA 3552 instead of DL1 AA 5332. The penalty was imposed solely based on this discrepancy.
The petitioner argued that the error was a typographical mistake, and there was no intention to evade tax. The court analyzed previous judgments, including M/s. Varun Beverages Limited v. State of U.P., highlighting that minor discrepancies, especially those not indicating an intent to evade tax, should not attract penalties.
The court referred to the Supreme Court judgment in Assistant Commissioner (ST) v. M/s. Satyam Shivam Papers Pvt. Ltd., emphasizing the necessity of mens rea (intent) for imposing penalties under Section 129 of the Act. It underscored that a typographical error without evidence of intent to evade tax should not lead to the imposition of a penalty.
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