Vishal Steel Supplier Vs State of U.P. (Allahabad High Court)
Summary: In the case of Vishal Steel Supplier v. State of U.P., the Allahabad High Court addressed the detention of goods during transit. The petitioner, transporting goods from Muzaffarnagar to Ghaziabad, was stopped in Hapur under the pretext that the route taken was not standard and the driver had a mobile number of a local dealer. However, the court found no discrepancies in the documentation accompanying the goods, including a tax invoice and e-way bill. The court highlighted that the Goods and Services Tax Act, 2017 (CGST Act) does not mandate the disclosure of a specific transportation route, a requirement that existed under the previous VAT regime. The High Court quashed the detention orders, stating that the authorities could only act when there is a lack of genuine documentation, which was not the case here. Additionally, the court ruled that without evidence of intent to evade tax, the detention of goods was unjustified, thereby mandating the refund of any amounts deposited by the petitioner. This judgment clarifies the legal stance on transportation routes under GST, reinforcing that sellers are not obligated to specify routes for goods in transit.
Introduction: The Hon’ble Allahabad High Court in the case of Vishal Steel Supplier v. State of U.P. [Writ Tax No. 741 of 2020 dated July 16, 2024], found the detention of goods unjustified and that, unlike the Value Added Tax Act, 2008 (“the VAT Act”), there is no specific provision in the Goods and Services Tax Act, 2017 (“the CGST Act”) which requires Assessee to disclose the route of transportation. Consequently, the Court quashed the detention orders and mandated the refund of any amount deposited.
