Goods cannot be detained merely because Consignee mentioned as Unregistered Person in E-Way Bill

ABCO Trades (P) LTD Vs Assistant State Tax Officer (Kerala High Court)

The issue under consideration is whether detention of goods merely because the consignee is mentioned as an unregistered person in the e-way bill is justified in law?

High Court states that, the reasons shown for detaining the consignment are not sufficient to attract the provisions of Section 129 of the GST Act. The detention in the instant case cannot, therefore, be seen as justified. I therefore allow the writ petition by directing the 1st respondent to immediately release the goods and the vehicle covered by a detention notice.

FULL TEXT OF THE HIGH COURT JUDGEMENT

The petitioner has approached this Court aggrieved by Ext.P5(c) order of detention that was issued to it detaining a consignment of lubricant oil that was being transported at its instance. On a perusal of Ext.P5(c) detention order, it is seen that the objection of the 1^st respondent is that the consignee was shown as an unregistered person in the e-way bill that accompanied the transportation of the goods. That apart, it is also pointed out that the petitioner had collected CGST and SGST in the delivery challan that was used for stock transfer of the goods thereby giving rise to a suspicion with regard to the nature of the transaction itself.

2. I have heard the learned counsel for the petitioner as also the learned Government Pleader for the respondents.

3. Learned counsel for the petitioner would submit that although the e-way bill showed the consignee as an unregistered person, the invoice that accompanied the transportation clearly referred to the GSTIN of the consignee and hence, the mere mention of the consignee as an unregistered person in the e-way bill cannot be of any significance. Secondly, it is stated that the mention of the tax applicable in the delivery challan was by mistake for it is evident that when the goods are stock transferred and not sold, there need not be a payment of tax at all.

Taking note of the said submission, I find that the reasons shown in Ext.P5(c) for detaining the consignment are not sufficient to attract the provisions of Section 129 of the GST Act. The detention in the instant case cannot, therefore, be seen as justified. I therefore allow the writ petition by directing the 1st respondent to immediately release the goods and the vehicle covered by Ext.P5(c) adetention notice, on the petitioner producing a copy of this judgment before the 1 ^st respondent. The Government Pleader shall also communicate the gist of this judgment to the 1^st respondent so as to enable the petitioner to effect an immediate clearance of the goods and the vehicle. The petitioner shall produce a copy of this judgment together with a copy of the writ petition before the 1st respondent for further action.