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Confiscation of goods is the ultimate act once proper adjudication is achieved. As soon as confiscation is executed the ownership and the possession goes out from its original owner to the governmental authority. Here we will discuss the topic confiscation of goods under GST. Provisions relating to it are given under Section 130 of Central Goods and Service Tax Act, 2017.
Table of Contents
It may be noted that these three terms are closely linked to each other but to think they mean the same, would be incorrect. Then what is the difference? Let’s find out.
Detention is not permitting access to the owner of the goods by a legal order. However the ownership remains with the owner.
Seizure means taking over the actual possession of goods by the authority.
Confiscation takes place after adjudication and the owner losses its ownership and possession. It is taken over by the governmental authority.
The Act states that in the following situations goods or conveyances are to be confiscated and the penalty is to be imposed:
The Act has also provided the provision to pay fine in lieu of confiscation. It means that any person can stop the confiscation of his goods, as the Act requires the adjudicating officer passing the order of confiscation to give an option to the owner of goods to pay some fine instead.
Conditions relating to Fine
In case any conveyance is hired for transfer of carriage of goods or passengers, then the owner of such conveyance should be given an option to pay fine in lieu of confiscation of such conveyance. Amount of such fine shall be less than the amount of tax that is to be charged on such goods transported through them.
Pre-Conditions for such confiscation
There are certain preconditions to be kept in mind in case of confiscation of any goods under the Act. They are:
One more thing we should bring some clarity about is the relation between confiscation, other punishments imposed and penalty under the GST Act. If any goods or conveyances are confiscations or any penalty is charged for the same under the provisions of the law or rules made thereunder, then it will not affect any other punishments imposed on such person under any other provisions of the Act or rules made thereunder.
It means that confiscation, penalty and any other punishments can be simultaneously imposed on any goods or services if they are charged under the Act or any rules thereunder.
It may be noted that confiscation of goods under GST would mean that the actual owner ceases to have any right on such goods. The ownership as well as the possession transfers to the government authority.
Read our article:
Power of Tax Authorities to conduct Special Audit under GST Act
Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.
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