Decision given by High Court of Telangana in case of Satyam Shivam Papers (P.) Limited V. Assistant Commissioner of Service Tax dated June 2, 2021
Following Principle emerged from the decision
Whether expiry of e-way bill may lead to detention of Goods?
According to the Principle laid down by High Court of Telangana – On account of non-extension of the validity of the e-way bill – no presumption can be drawn that there was an intention to evade tax.
|Appeal||Satyam Shivam Papers (P.) Limited (Petitioner) filed writ Petition before High Court of Telangana on account goods detained for the reason of “Expiry of E-way Bill”|
|Facts of Case||The petitioner is a Private Limited Company registered under the Companies Act, 1956, and carries on trading business in all kinds of paper. The Petitioner has made an intra-State supply of paper through a tax invoice M/s. Sri Ayappa Stationery and General Stores in Telangana State and had also generated an e-way bill.|
|Reason for which goods were detained by the Department||During the course of Transportation within the city, the conveyance was stopped for the verification of documents and since the e-way bills was valid only up to 5-1-2020 12:00 a.m. and were not valid on 6-1-2020 when the checking was done by him, he was entitled to detain them; and that the drivers of the auto trolleys expressed ignorance of the expiry of the e-way bill.|
|Contention of the Tax Payer||
|Contention of the Department||
|Counter Reply of Tax Payer for the Contention raised by Department||
|Principle Laid down by High Court||
Note: – Expiry of E-way Bill cannot be considered as sole reason for detention of goods, unless there are possibilities of tax evasion. Further Section 129 of CGST Acts mandate the manner in which Proceedings is to be conduct. No Officer can use the Power not Prescribed in the Act and detain the goods in the manner other than the manner he is ought to follow. Storing the detained goods at the Premises of Relative’s house is not prescribed in the Act. Further, for every instance of expiry of e-way bill the Proper Officer is required to apply his mind as to whether there is Possibility of tax evasion. At times, the may not be clear possibility but there may be a lower Probability of Tax Evasion in such circumstance Principle laid down by Gujarat High Court in case of Synergy Fertichem Pvt. Ltd Vs State of Gujarat. It is also Pertinant to note that one aspect of the case is yet unanswered – Let us say, the expiry of e-way bill could lead to the Probability of Tax evasion in the given case – then in such scenario whether the Proceeding conducted in such a manner by the Officer would stand correct ? As the signing of Release Order, detaining the Goods for 16 days as well as Storage of detained goods at relative premises is not prescribed in the GST Law and Rules.