HC Directed Dept. to Refund Tax and Penalty Levied for Not Carrying Original Tax Invoice by Transporter

Case Details: Kolvekar Logistics v. Joint Commissioner of Commercial Taxes (Appeals) - [2024] 162 taxmann.com 658 (Karnataka)

Judiciary and Counsel Details

• M.G. Uma, J.
• Narayan G. Rasalkar, Adv. for the Petitioner.
• Smt. Kirtilata R. Patil, HCGP for the Respondent.

Facts of the Case

The petitioner was a partnership firm carrying on its business and registered under Goods and Services Tax Law. It was transporting bitumen for subsequent sale in heat insulated containers in liquid state, ensuring conditioning of temperature. When the container was transporting the consignment, the officer of the Commercial Tax intercepted and inspected the vehicle and found that original tax invoice was not carried in the vehicle.

The enforcement passed an order and determined the tax and penalty. The petitioner paid the tax and penalty and filed appeal against the order. The first appellate authority confirmed the demand and penalty by holding that original outward supply tax invoice was not tendered by the driver but only Xerox copy of the invoice was produced.

It filed writ petition against the order of the first appellate authority and contended that the transporter was not required to carry original tax invoice but only duplicate copy of invoice. The department submitted that the tax and penalty was imposed since the petitioner was not carrying the original tax invoice.

High Court Held

The Honorable High Court noted that the transporter was not required to carry original tax invoice but only duplicate copy of invoice. As per Rule 48 of CGST Rules, 2017, the invoice is required to be prepared in triplicate in case of supply of goods and copy marked as Original is meant for recipient or purchaser of the consignment and same will be directly sent to the purchaser. The duplicate copy is meant to be carried by the transporter during transit. Therefore, the stand taken by revenue authority that assessee was liable to pay tax and penalty as transporter had not carried original tax invoice was not acceptable.

The Court also noted that the petitioner was levied with double tax as he was already paid tax and once again he was compelled to pay tax with penalty. Thus, it was held that the order was liable to be set aside and tax and penalty, if any, paid in excess would be refunded.

List of Cases Reviewed

• M/S Divya Jyothi Petrochemicals Co. v. Joint Commissioner of Commercial Taxes 1 followed.