The article is in light of the Notification 39/2021-CT(R) dated 21.12.2021, wherein Central Government appoints 01.01.2022 as the date for various amendments made through Finance Act, 2021 to come into force. Amongst others, amendments to section 129 of CGST Act, ie, Detention, seizure and release of goods and conveyances wrt e-way bill contraventions, shall come into effect from 01.01.2022.
Relevant Provisions of section 129 of CGST Act prior and post 01.01.2022
| Particulars | Prior to 01.01.2022 | Post 01.01.2022 | |
| In case owner of goods comes forward | Taxable Goods | Tax and penalty equal to 100% of the tax payable | Penalty equal to 200% of tax payable |
| Exempt Goods | 2% of the value of goods or Rs 25,000, whichever is less | ||
| In case owner of goods does not come forward | Taxable Goods | Tax and penalty equal to 50% of the value of goods reduced by tax paid | Penalty equal to 50% of the value of goods or 200% of the tax payable on goods, whichever is higher |
| Exempt Goods | 5% of the value of goods or Rs 25,000, whichever is less | ||
Further, time limits have been prescribed for issuance of notice as well as order in respect of goods and conveyance so detained. Notice for payment of penalty shall be issued within 7 days from date of detention and order shall be passed within 7 days from the date of such notice. Therefore, e-way bill proceedings under section 129 shall be concluded within 14 days from date of detention.
In addition to the above, if the transporter of owner of the goods does not pay the penalty within 15 days from the date of order, the goods or conveyance is liable to be sold or disposed of to recover the penalty. In case, the transporter pays the penalty as mentioned in table above or Rs 1,00,000, whichever is less, the conveyance shall be released. It is pertinent to note that such option was not available to the transporter prior to the amendment (01.01.2022)
Under the earlier provisions, there was ambiguity on whether taxes for supply of goods will have to be paid in addition to the taxes paid under section 129, specifically in light of ITC restriction under section 17(5)(i). Moreover, no mechanism was provided to adjust the taxes paid under section 129, in the GSTR 3B. With the amendment of provisions of section 129, by increase the penalty to 200%, the ambiguity is now put to rest.
Whether penalty needs to be paid even in case of minor offenses
Circular 64/38/2018-GST dated 14.09.2018 clarifies that in case the consignment of goods is accompanied with an invoice and also e-way bill, penalty under section 129 is not applicable and nominal penalty of Rs 1,000 shall be levied under section 125 of CGST Act, in the following cases:
a) Spelling mistakes in the name of the consignor or the consignee but the GSTIN, wherever applicable, is correct;
b) Error in the pin-code but the address of the consignor and the consignee mentioned is correct, subject to the condition that the error in the PIN code should not have the effect of increasing the validity period of the e-way bill;
c) Error in the address of the consignee to the extent that the locality and other details of the consignee are correct;
d) Error in one or two digits of the document number mentioned in the e-way bill;
e) Error in 4 or 6 digit level of HSN where the first 2 digits of HSN are correct and the rate of tax mentioned is correct;
f) Error in one or two digits/characters of the vehicle number.
While the Circular lists the scenarios mentioned above, various courts have taken liberal interpretation of the Circular and extrapolated to various scenarios wherever there is no revenue loss.
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The detailed summary of such cases has been provided in our book “Madhukar Hiregange’s Practical Guide to E-way Bill under GST”, which is now available on Amazon (https://www.amazon.in/Madhukar-Hireganges-Practical-Guide-under/dp/ 9390176026)
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Dear sir,
Today we paid a penalty because of value issue, can we get return this amount,
This is not invoice, Material transfer value 1200000 and we mentioned a 164000 tying error,
Sales tax person made challan -270000 rupees
Please suggest
we have generated e-way bill but wrongly we have selected ODG INSTED OF REGULAR and validity shown 3 month and GST authority imposed panelty 200 persentage kindly advice
value of goods is less than 50 thousand , about 48k and there was no e way bill and vehicle was seized by sales tax officers and they make the good of amount 80k and generated panelty bill of 80k , we have paid the panelty now to release the vehicle of 3rd person , now the situation is it was construction old iron material whose value is 48k if it is new . we have paid more than its value , i want to know what we can do now ( we are also paying gst bill for that material regularly and we have bill of that as well) actually my grand father was passed away and we were in village so we could not do anything from there other than to pay the panelty so that vehicle person get its vehicle . sincerely please suggest someone how should i get refund of that money or what should i do now . thanks Ankit
Please send me a update information about GST detail . Thank you.
What about any scenario where a GST squad of Madhya Pradesh halts a vehicle for example moving from Karnataka to Haryana? Even if everything is correct, they require you to go to their location to release the vehicle with the threat of huge penalties. There is no redressal mechanism at all and no way to get vehicle released from your despatch location. License Raj is back with full vengence.
When my supplier delivers goods on my behalf to my customers, having generated EWB for me.
In this should l also generate EWB for my clients?
We raised E.Way bill ( for Rs.10 Lakhs) along with DC,
but some of reasons we didn’t raise Invoice last 10months
is there any penalty. Is there any time limit there for raising the Invoice.