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2023 (8) TMI 1036 - HC - GSTLevy of penalty - Detention of goods alongwith vehicle - e-way bill generated for return of goods without issuing credit note - issuance of Credit Notes u/s 34 of the respective GST enactments - HELD THAT:- There is no dispute that the petitioner had dispatched the goods to the consignee/buyer by four different invoices all dated 25.12.2022 - The goods also accompanied e-way bills all dated 26.12.2022. The goods were not received by the consignee/buyer and therefore, they were re-transported back by the petitioner after generating four different e-way bills all 28.12.2022. Under Section 34(1) of the CGST Act, where one or more tax invoices have been issued for supply of any goods or services or both and the taxable value or tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply, or where the goods supplied are returned by the recipient, or where goods or services or both supplied are found to be deficient, the registered person, who has supplied such goods or services or both, may issue to the recipient [one or more credit notes for supplies made in a financial year] containing such particulars as may be prescribed - the goods which are being returned need not necessarily accompany a Credit Note. The Credit Note or Debit Note as the case may be are intended only for adjustment of tax liabilities on account of return of the goods and where tax charged in that tax invoice is found to exceed the taxable value or tax payable in respect of such supply. The detention of the goods was per se illegal and unwarranted particularly in the light of the fact that the goods accompanied the e-way bills, which were generated for return of the goods - the system and procedure cannot be used against the petitioner particularly in the light of the fact that the detention itself was illegal. Credit note under Section 34 is not required to be issued at the stage, when the goods were being returned without even they having been received by the recipient. Issuance of Credit Note and/or Debit Note under Section 34(1) of the CGST Act, is only for adjustment of tax liability. The petitioner has to merely declare the details of the Credit Note in the monthly return during which Credit Note is issued for adjustment of tax liability - The question of issuing Credit Note also will arise only by the supplier and not by the recipient. Petition allowed.
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