In one of the recent judgment of Kerala High Court in M/S Indus Towers Limited Vs. The Assistant State Tax Officer, it was held that goods cannot be confiscated for every non- compliance of the provisions of the act.
The petitioner-Company engaged in the establishment and maintenance of towers for telecom service providers was transporting some batteries without submission of KER-1(equivalent to E-Way Bill). The goods were however being accompanied by Delivery challan.
Revenue contended that as per section 129, the goods can be detained for any violation of CGST, SGST Acts and the Rules made there under. Hence goods can be detained even in transactions which do not involve taxable supply. However, the Counsel appeared on behalf of the assessee, contended that non-submission of KER-1 was the only defect pointed out by the Revenue and the same had been furnished subsequently on receipt of the notice.
It was being highlighted by the judiciary that goods that are being transported for own consumption would not involve any consideration. Further the same is not a taxable supply as per GST Act.
Further, Section 129 of the SGST Act can be exercised only in respect of goods which are liable to be confiscated under Section 130 of the SGST Act. Goods cannot be detained if the case is not covered under section 130.
It was clarified, that goods cannot be detained for infraction of procedural rule 138 of the SGST Rules. They may be subject to penalty but not confiscation.
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