[Opinion] Importance of the Phrase “Inter Alia” Used in Circular and Its Impact on Penalty Under Section 129 of the CGST Act 2017

CA Rajesh Kumar Khandelwal – [2024] 162 taxmann.com 255 (Article)

Section 68 of CGST Act 2017

According to Section 68 of the CGST Act, along with Rule 138A of the Central Goods and Services Tax Rules, 2017 (referred to as ‘the CGST Rules’), the person in charge of a conveyance carrying goods valued at more than Rs 50,000/- must carry specific documents. These documents include the invoice, bill of supply, delivery challan, bill of entry, and a valid e-way bill in either physical or electronic form for verification.
Failure to carry these documents constitutes a violation of the law, and the provisions of Section 129 and Section 130 of the CGST Act can be invoked. Additionally, it’s important to note that not providing information in Part B of FORM GST EWB-01 renders the e-way bill invalid for road transportation, except when goods are transported within a distance of up to fifty kilometers within the same state or union territory between the transporter’s place of business and the consignor’s or consignee’s place of business.

Section 129 of CGST Act 2017

Section 129 of the CGST Act provides for the detention and seizure of goods and conveyances. These can be released upon payment of the requisite penalty in cases where the goods are transported in violation of the provisions of the CGST Act or the rules made thereunder. However, it has come to notice that proceedings under section 129 are being initiated even for minor, clerical, or technical mistakes mentioned in the documents, as per rule 138A.

Circular No. 64/38/2018-GST New Delhi, dated the 14th September 2018

In light of the stringent penalty provisions under section 129 of the CGST Act 2017, several representations were submitted to the Central Board of Indirect Taxes and Customs (CBIC) regarding the imposition of penalties for minor discrepancies in the details mentioned in e-way bills. Despite no major lapses in the invoices accompanying the goods during movement, penalties were being levied. After careful examination, the CBIC, exercising its powers conferred under section 168 of the Central Goods and Services Tax Act, 2017 (referred to as ‘the CGST Act’), issued Circular No. 64/38/2018-GST on September 14, 2018. This circular addresses technical and clerical mistakes related to e-way bills.

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