Aries Agro Limited Vs State Of Uttar Pradesh and 2 others (Allahabad High Court)
Allahabad High Court has ruled that GST authorities are obligated to issue a penalty order in Form GST MOV-09, even if the taxpayer has paid the penalty under protest to secure the release of detained goods. This decision came in the case of Aries Agro Limited Vs State Of Uttar Pradesh and 2 others, where the petitioner challenged the respondents’ refusal to issue the said form after a penalty payment.
Aries Agro Limited’s vehicle was intercepted, and to obtain the release of their goods, they paid the penalty under protest, as documented in Form GST DRC-03. Subsequently, the company requested the issuance of Form GST MOV-09, which was rejected by the authorities. The authorities contended that once the amount was deposited, there was no necessity to issue an order in Form GST MOV-09.
The petitioner argued that the non-issuance of Form GST MOV-09 was unjustified, especially since the payment was made under protest. They asserted that without a formal order, they were deprived of their right to challenge the penalty before the appropriate authority.
The respondents, while not disputing that an order should be passed when payment is made under protest, maintained that the prescribed procedure does not envisage issuing Form GST MOV-09 once the amount has been deposited and goods released.
The High Court, after reviewing the submissions and records, found that the payment was indeed made under protest. The court emphasized that even if the payment had not been made under protest, the authorities could not refuse to issue the penalty order in Form GST MOV-09. The court highlighted that denying such an order effectively deprives the taxpayer of their right to appeal and challenge the authorities’ action.
Consequently, the court allowed the petition, quashing and setting aside the respondent’s rejection order dated November 28, 2024. Respondent No. 3 has been directed to pass an order in Form GST MOV-09 within three weeks, after which Aries Agro Limited will be at liberty to pursue appropriate legal proceedings. This judgment underscores the importance of formal orders in tax proceedings, safeguarding the taxpayer’s right to due process and appeal.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
