Detention of Goods Justified as Assessee Failed to Prove Ownership of Goods in Transit | HC

Case Details: HDB Financial Services Ltd. vs. State of U.P. - [2025] 171 taxmann.com 238 (Allahabad)

Judiciary and Counsel Details

• Arun Bhansali, CJ. & Vikas Budhwar, J.
• Amit Shukla, for the Petitioner.
• Ankur Agarwal, S.C. for the Respondent.

Facts of the Case

The petitioner, engaged in the transportation of goods, faced the detention of its vehicle carrying goods and imposition of a penalty under Section 129(3) of the Central Goods and Services Tax Act, 2017 (CGST Act). The vehicle was intercepted while moving goods, and the authorities imposed a penalty citing the absence of an e-way bill. The petitioner contended that the goods were merely being transferred to its parking yard and, therefore, did not require an e-way bill. However, despite having 15 days to claim ownership, the petitioner failed to take appropriate action. Upon rejection of its submissions, the petitioner approached the High Court, challenging the validity of the penalty order.

High Court Held

The Hon’ble High Court held that the writ petition was not maintainable due to the petitioner’s inaction and the availability of an alternative statutory remedy. It was observed that the petitioner had an opportunity to establish ownership of the goods within the statutory timeframe but failed to do so. Further, the court noted that the petitioner’s assertions were casual and lacked substantiation. Given the existence of an appellate remedy under the CGST Act, the High Court dismissed the petition, leaving it open for the petitioner to avail the alternative remedy, with the benefit of Section 14 of the Limitation Act, 1963.