Case Law Details
Riadi Steels Llp Vs State of U.P. And 4 Others (Allahabad High Court)
Introduction: In a notable judgment, the Allahabad High Court addressed the nuances of goods transport and the implications of technical breaches under the Goods and Services Tax (GST) regime. In the case of Riadi Steels Llp vs State of U.P. And 4 Others, the court examined the validity of penalties imposed due to an expired e-way bill, against the backdrop of unforeseen mechanical issues faced by the transporting vehicle.
Detailed Analysis: Riadi Steels Llp challenged the imposition of penalties under Section 129 of the Uttar Pradesh Goods and Services Tax Act, 2017, for carrying goods with an expired e-way bill. The petitioner’s primary contention revolved around the vehicle’s slow movement due to an engine fault, which led to the delay and the consequent expiry of the e-way bill four days prior to detention.
The defense argued the existence of a mechanism on the GST portal that allows for the extension of the e-way bill’s validity, a procedure that was not utilized by Riadi Steels. This oversight was cited by the respondents as justification for the penalty. However, the petitioner furnished evidence, including GPS tracking data, to substantiate the claim of the vehicle’s slow movement due to mechanical issues.
The Allahabad High Court, drawing parallels with similar cases such as M/s Globe Panel Industries India Pvt. Ltd. vs State of U.P. and Others, deliberated on the necessity of mens rea, or the intent to evade tax, for the imposition of penalties under GST laws. The Court found that the factual circumstances of Riadi Steels Llp’s case did not exhibit any intent to evade tax, noting that the goods were accompanied by the requisite documentation and the vehicle’s slow progress was due to genuine mechanical failures.
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