Zhuzoor Infratech Private Limited Vs Additional Commissioner Grade 2 And Another (Allahabad High Court)
The Allahabad High Court, in Zhuzoor Infratech Pvt. Ltd. vs. Additional Commissioner Grade 2 & Another, quashed a penalty order imposed on the petitioner due to a technical discrepancy in the e-way bill. The petitioner, a registered dealer, had procured 16 mm TMT bars from Jharkhand for delivery to New Delhi. However, during transit, the consignment was intercepted because the e-way bill contained the petitioner’s West Bengal address as the shipping address instead of New Delhi. The authorities initiated proceedings and imposed a penalty, despite there being no dispute regarding the nature, quantity, or quality of goods.
The petitioner argued that the e-way bill was auto-populated by the GST portal based on the e-tax invoice, making the discrepancy a technical error beyond the petitioner’s control. The petitioner contended that the e-way bill serves the purpose of tracking goods movement to prevent tax evasion, and since the transaction was legitimate, the penalty was unjustified. The respondents, however, defended the penalty, maintaining that the irregularity in the shipping address warranted enforcement action.
The Court ruled that a technical error in the e-way bill does not warrant the seizure of goods or imposition of penalties, provided there is no discrepancy in the goods themselves. It emphasized that once the e-way bill is generated and remains uncanceled, the transaction’s genuineness cannot be questioned. The judgment cited M/s Sun Flag Iron and Steel Company Limited vs. State of UP & Others (2023), where a similar ruling was made. In that case, the Court had clarified that the primary purpose of an e-way bill is to inform tax authorities of goods movement, and if not canceled within the prescribed time, the transaction should be presumed valid.
