HC Directed Dept. To Refund Tax & Penalty Since Authorities Didn’t Consider Petitioner’s Explanation and There Was No Intention to Evade Tax

Case Details: Vishal Pipes Ltd. v. State of U.P. - [2024] 163 taxmann.com 586 (Allahabad)

Judiciary and Counsel Details

• • Shekhar B. Saraf, J.
  • Vishwjit for the Petitioner.
  • C.S.C. for the Respondent.

Facts of the Case

The petitioner was aggrieved by the order imposing penalty under Section 129(3) and the order in appeal. The department had raised two issues for imposition of the tax i.e. expiry of e-way bill and discrepancy in weight of goods. The petitioner furnished explanation on both the issues raised by the authorities. But the GST Authorities imposed penalty under Section 129(3) and rejected appeal. It filed writ petition against both the orders.

High Court Held

The Honorable high Court noted that some of the goods were traveling from Sikandrabad to Shamli, and thereafter, the balance goods to Muzaffarnagar. At both the places goods were sent to the same purchaser. The difference in quantity of the goods was explained by the fact that the total quantity of the goods was 13,820 kilograms out of which 8200 kilograms were dropped at Shamli and the balance goods were taken to Muzaffarnagar.

The Honorable High Court further that the expiry of e-way bill by itself without intention to evade tax would not attract penalty. Moreover, the authorities failed to consider petitioner’s explanation and there was no intention to evade tax. Therefore, the Court held that the impugned penalty order and appellate order was liable to be quashed and the department was directed to refund tax and penalty deposited.