Metalloids India Vs Commissioner of State Tax Keralam State (GSTAT Thiruvananthapuram)
Summary: GSTAT Thiruvananthapuram allowed the appeal of Metalloids India and set aside the penalty proceedings under Section 129 of the CGST/SGST Act arising from transportation of aluminium colour coated coils and G.I. sheets from a job worker back to the principal after completion of job work. The Tribunal found that the show-cause notice was factually inaccurate because departmental records themselves showed that the consignment was accompanied by a tax-paid job-work invoice, the principal’s delivery challan and an e-way bill. Referring to CBIC Circular No. 38/12/2018 dated 26.03.2018, it held that the documentary requirements concerning return of goods by the job worker had been complied with.
The Tribunal further held that the original allegation of absence of an e-way bill could not subsequently be converted into an allegation regarding validity or deficiency of that e-way bill, since a new ground outside the show-cause notice violated principles of natural justice. On the substantive valuation issue, the Tribunal read Rule 138 with Section 15 of the CGST/KGST Act and held that, when goods belonging to the principal are returned after job work, the taxable supply is the job-work service and the value of the principal’s original goods is not includable in the consignment value for the return movement. Here, the job-work invoice and consequent consignment value was ₹1,841, below the ₹50,000 threshold under Rule 138(1). Consequently, an e-way bill was itself not mandatory and proceedings alleging absence or defect in the e-way bill were held void ab initio. The appeal was allowed with consequential relief.
