Re-use of E-way bill & tax invoices show intention to evade, and hence attracts Sec 130 CGST Act

Hearing a petitioner challenging the validity of confiscation of goods being ferried inter-State, as well as confiscation of the vehicle carrying them, the High Court of Punjab & Haryana, observed that the Assistant Commissioner of Excise and Taxation Officer of State Tax was competent and authorized to exercise the powers under Section 129 and 130 of the CGST Act, 2017, pertaining to seizure and confiscation of goods as well as the vehicle conveying them.

Nevertheless, the Division Bench of Justice Sandhawalia and Justice Harpreet Kaur Jeewan, also clarified that ‘intention to evade payment of tax’ was an essential ingredient, for initiating proceedings against a person under Section 130 of the CGST Act.

The Petitioner was represented by Advocate Keane Sardhina, whereas, the Respondent-Department was represented by Mr. Arun Beniwal, DAG, Haryana.

The facts of the matter, succinctly put, are that the Petitioner was transporting certain goods from Tamil Nadu to Delhi. In transit, the vehicle conveying the goods was intercepted within the boundaries of Haryana, and inspection of papers revealed that the e-way bill and tax invoices documents were being re-used by the Petitioner with intention to evade payment of tax.

Hence, the goods as well as the truck carrying them were seized and subsequently confiscated by the Respondent-Department, in exercise of powers under Section 129 and Section 130 of the Central Goods and Services Tax Act 2017 (CGST), along with corresponding provisions of the Integrated Goods and Services Tax Act 2017 (IGST). Penalty also came to be imposed.

On hearing the submissions of both parties, the High Court observed there to be two issues at hand, namely whether the Assistant Commissioner of Excise and Taxation Officer of State Tax of the GST Department in Haryana was competent to pass an order under the provisions of Sections 129 & 130 of the CGST Act, 2017and whether the order passed by the Respondent was liable to be quashed.

In respect of the first issue, the Bench observed that in view of the provisions of Section 20 of the CGST Act as well as Section 4 of the IGST Act, and also considering the order passed  by the Excise and Taxation Commissioner, Haryana, assigning the functions of the Proper Officer under the Haryana GST Act, the Assistant Commissioner of Excise and Taxation Officer of State Tax was found to be the competent officer to pass order under Section 129 and 130 of the CGST Act in respect of the goods being transported inter-State from Tamil Nadu to Haryana.

With regards to the other issue as to the validity of the order passed, the Bench observed that the Petitioner was given a proper opportunity of hearing before passing the order.

Moreover, the Petitioner had been found trying to re-use E-way bill documents and tax invoices. Thereby, the Petitioner’s intention to evade payment of tax was found to be have been established by the Department.

With these observations, the Bench upheld the order of seizure and confiscation of the goods and the vehicle conveying them and thus resolved the issues at hand in favour of the Revenue.

Cause Title: M/s Bright Road Logistics Vs State of Haryana and Others [CWP-2490-2019 (O&M) / 2023-Enterslice-7-HC-P&H-GST]

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