Goods Can’t Be Detained for Non-Generation of E-Invoice if There Was No Intention To Avoid Tax Payment | HC

Case Details: Nancy Trading Company v. State of U.P - [2024] 164 taxmann.com 470 (Allahabad)

Judiciary and Counsel Details

• Piyush Agrawal, J.
• Arjit Gupta, Manish Gupta & Naveen Chandra Gupta for the Petitioner.

Facts of the Case

The petitioner was engaged in the business of trading. The goods of petitioner were detained in transit by the department and it was alleged that e-invoice was not generated as per Rule 48 of CGST Rules. The goods were released on payment of tax and penalty and the petitioner filed appeal against the detention order but the same was rejected. It filed writ petition against the demand order.

High Court Held

The Honorable High Court noted that there was no discrepancy with regard to quality and quantity of goods as mentioned in Tax Invoice, e-waybills, GR’s etc. which were accompanying goods. It was a case of technical error committed by petitioner for not generating e-invoice before movement of goods.

The Court also noted that the limit of annual turnover for issuing e-way bill was reduced w.e.f. 01.08.2022 to Rs. 10 crores and mistake committed by petitioner was bonafide. Therefore, in absence of any specific finding with regard to mens rea for evasion of tax, it was held that the impugned order demanding tax and penalty was liable to be set aside.