Case Law Details
Tata Hitachi Construction Machinery Company Private Limited Vs State of Uttar Pradesh and 2 Others (Allahabad High Court)
The writ petition challenged an order dated 28.04.2025 issued by the Assistant Commissioner, Sector-5 (Mobile Squad-5), Gautam Buddha Nagar, imposing a penalty under Section 129(3) of the U.P. GST Act, 2017. The penalty was based on the finding that the goods being transported were accompanied by an e-way bill in which Part-B had not been filled, constituting a violation of Rule 138 of the GST Rules. The petitioner submitted that the omission was merely a technical lapse and that there was no intention to evade tax, noting that no such finding had been recorded by the authority. Reliance was placed on prior decisions of the High Court, including the judgment in Precision Tools India, which held that penalty under Section 129 cannot be imposed solely for non-filling of Part-B unless an attempt to evade tax is established. The respondents argued that the missing Part-B was undisputed and that intention to evade tax was irrelevant, although they acknowledged the Court’s consistent view in earlier cases. Upon examining the record, the Court observed that the impugned order mentioned only the violation of Rule 138 and contained no finding regarding tax evasion. Consistent with its earlier rulings, the Court held that in the absence of a recorded attempt to evade tax, non-filling of Part-B alone does not attract penalty under Section 129. The writ petition was allowed, the penalty order was set aside, and the bank guarantee furnished under protest was directed to be returned to the petitioner within two weeks.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. This writ petition is directed against order dated 28.04.2025 passed by the Assistant Commissioner, Sector – 5 (Mobile Squad – 5), Gautam Buddha Nagar, Uttar Pradesh, wherein the petitioner has been imposed with penalty under Section 129(3) of the U.P. G.S.T. Act, 2017 (for short ‘the Act’).
2. Submissions have been made that the goods, when the same were being carried, were stopped at Sirsa Cut and it was found that though the e-way bill, was being carried, the part-B of the same was not filled up based on which, notice was issued to the petitioner. Though the petitioner appeared and a response was filed. The respondent authority, came to the conclusion that as the movement was without filling up part-B, it was not valid in view of violation of provisions of Rule 138 of the G.S.T. Rules 2017 and hence the penalty was imposed.
3. Learned counsel for the petitioner made submissions that the non-filling of part-B, is only a technical breach and there has been no intention to evade tax and that no finding in this regard has been recorded by the authority and, therefore, in view of the series of orders passed by this Court laying down that unless there is an intention to evade tax only on account of non-filling up of part-B of the e-way bill by itself, would not attract penalty under Section 129 of the Act, and therefore, the order impugned deserves to be set aside. Reliance has been placed on the judgment in M/s Precision Tools India vs. State of U.P. and others, Writ-Tax No. 415 of 2023 decided on 29.01.2024.
4. Learned counsel for the respondents supported the order impugned. Submissions have been made that the lack of requisite document, i.e. unfilled part-B of the e-way bill is not in dispute. Submissions have been made that the intention to evade tax may not be relevant in such circumstances and, therefore, the imposition of penalty cannot be faulted. However, it is not disputed that this Court has consistently taken view as laid down in the case of Precision Tools India (supra).
5. We have considered the submissions made by counsel for the parties and have perused the material available on record.
6. A perusal of the order impugned passed by Assistant Commissioner, Sector – 5 (Mobile Squad – 5), Gautam Buddha Nagar, Uttar Pradesh would reveal that except for noticing violation of provisions of Rule 138 on account of non-filling up of part-B of e-way bill, not a word has been indicated pertaining to any attempt to evade tax.
7. In view of the series of orders passed by this Court laying down that unless an attempt is made to evade tax and a finding in this regard is recorded, mere non-filling of part-B of e-way bill would not attract penalty under Section 129 of the Act, the order impugned passed by the respondents cannot be sustained.
8. Consequently, the petition is allowed. The order dated 28.04.2025 passed by the Assistant Commissioner, Sector – 5 (Mobile Squad – 5), Gautam Buddha Nagar, Uttar Pradesh is set aside. As the petitioner has given bank guarantee for the amount of penalty under protest, the bank guarantee shall be returned back to the petitioner within a period of two weeks from the date of this order.
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