Raj Steel Vs State of U.P. And 2 Others (Allahabad High Court)
Allahabad High Court has quashed a confiscation order issued against Raj Steel under Section 130 of the Goods and Services Tax (GST) Act, stemming from the discovery of excess stock. The Court affirmed that such situations should be addressed through proceedings under Section 73 or 74 of the UPGST Act, rather than draconian confiscation measures.
The writ petition challenged orders dated September 7, 2024, and February 5, 2020, both issued under Section 130 of the GST Act. The petitioner’s counsel argued that the case was directly covered by the High Court’s own decision in S/s Dinesh Kumar Pradeep Kumar Vs. Additional Commissioner, Grade – 2 & Another (Writ Tax No. 1082 of 2022, decided on July 25, 2024), a ruling subsequently affirmed by the Supreme Court on April 17, 2025.
In the Dinesh Kumar Pradeep Kumar case, the High Court explicitly held that if excess stock is found, proceedings under Sections 73 and 74 of the UPGST Act are applicable, precluding the initiation of proceedings under Section 130. The State’s Additional Chief Standing Counsel did not dispute this established precedent.
Consequently, the Allahabad High Court allowed Raj Steel’s writ petition, quashing both impugned orders and directing the refund of any amount deposited by the petitioner in accordance with law.
