Clerical mistake in Part-B of e-way bill is excused by Additional Commissioner of State Tax Himachal Pradesh in the case of M/s. K.B.Enterprises vs Asstt. Commissioner of State Taxes and Excise of State Goods and Service Tax, Chamba.

[Ganeshan Kalyani]

M/S. K.B. ENTERPRISES CHAIL CHOWK, DISTT MANDI VERSUS THE ASSISTANT COMMISSIONER STATE TAXES & EXCISE CHAMBA, HP [2019 (12) TMI 1089 - APPELLATE AUTHORITY FOR ADVANCE RULING HIMCHAL PRADESH]

The appellant M/s. K.B.Enterprises, a registered tax payer is engaged in the supply of a taxable goods. One particular vehicle bearing no. HP 32A 3097, carrying a goods of the appellant to his customer's place was caught and detained by a commercial tax officer on 01.12.2018. The reason the authority gave for the detention of vehicle was that the vehicle number in Part-B of the e-way bill no. 301067898208 was mentioned as HP 32A 1597 instead of correct vehicle no. HP 32A 3097. Except the incorrect vehicle number all the documents were found in order by the officer.

The appellant submitted that the mistake in Part-B of the aforesaid e-way bill was a clerical mistake. The authority did not heed to his prayer and submission and imposed a penalty u/s 129(1) of CGST / HPGST Act, 2017 vide Order dated 03.12.2018. Against the said order the appellant filed an appeal at Additional Commissioner of State  Tax Himachal Pradesh.

Ground of Appeal:

The physical characteristics of the goods detained was in consonance with tax invoice, goods receipt and e-way bill except vehicle number.  There was no deviation from the goods declared in the invoice and the goods transported by the appellant. The goods detained were accompanied by a valid e-way bill except Part-B.

The appellant has made all the entries of the above said transaction in its books of accounts and the tax and supply has been properly accounted for. Further, the record of Part A of E-way Bill generated by the appellant is available on the GST portal. Given this the intention to evade tax could not be attributed to the appellant. Therefore the penalty should not be levied on the Appellant.

On perusal of the Rule 138 of CGST Rules it can be seen that the primary basis for movement of goods is PART A of the E-Way Bill and the utmost importance of the same cannot undermined. The PART B is just the ratification of PART A by way of addition/updation of information about the details of the vehicle only. It is submitted that wrong filing of vehicle details in PART B was an inadvertent mistake and the does not render the whole transaction as illegal one.

It is submitted that circular vide No. 64/38/2018 Dt. 14th Sep., 2018 under CGST Act 2017, states that in case a consignment of goods is accompanied with an invoice or any other specified document and also an e-way bill, proceedings under section 129 of the CGST Act may not be initiated, inter alia, in the following situations:

a) Spelling mistakes in the name of the consignor or the consignee but the GSTIN, wherever applicable, is correct;

b) Error in the pin-code but the address of the consignor and the consignee mentioned is correct, subject to the condition that the error in the PIN code should not have the effect of increasing the validity period of the e-way bill;

c) Error in the address of the consignee to the extent that the locality and other details of the consignee are correct;

d) Error in one or two digits of the document number mentioned in the e-way bill;

e) Error in 4 or 6 digit level of HSN where the first 2 digits of HSN are correct and the rate of tax mentioned is correct;

f) Error in one or two digits/characters of the vehicle number.

In case of the above situation, penalty to the tune of ₹ 500/- each under section 125 of the CGST Act and the respective State GST Act should be imposed (₹ 1000/- under the IGST Act) in FORM GST DRC-07 for every consignment.

Thus, the above cited provisions of the circular clearly states that in case, where there is mistake of one or two digits/characters of the vehicle number, the maximum penalty imposable is ₹ 1000/- i.e .₹ 500/- for CGST and ₹ 500/- for SGST Act.

It is submitted that is the present case the Appellant has already discharged IGST on the entire value of the goods supplied to his customer. As the supplier of Appellant has already discharged the CGST/HPGST on the impugned goods, the confirmation of the demand of tax penalty under CGST and HPGST leads to double taxation and is totally unjustified.

The main contention of the authority to detain the vehicle was that the vehicle bearing number HP32A-1597 was engaged in another consignment being transported from Baggi (Distt. Mandi) to Balh (Distt. Mandi) having E-Way Bill No. 3310 6862 1194 dated:01-12-2018 time 04:03 pm. The authority concluded that to generate the E Way Bill against a different Vehicle number and carrying the same bulk of consignments in another vehicle against the strength of the e-way bill generated with different vehicle details and seeking the benefit of doubt, at the pretext of clerical mistake in mentioning of vehicle No. as per provisions made in this regard vide Circular No 64/38/2018-GST Dated 14.09.2018 and thus demanding relaxation in invoking of provision of sec 129(1), has been held to be modus operandi followed by the appellant to design / fabricate the goods delivery system for supplying more than one consignment against the strength of a single e-way bill and by doing so the said firm has misled the checking team by claiming the clerical mistake in Vehicle No. e- way bill.

Decision:

n the view of above discussions the appellate authority is of the considerate opinion that the penalty imposed in the instant case under section 129 was unwarranted. GST Council vide circular No 64/38/2018 dated 14th September, 2018 and the HP circular no.12-25/2018-19-EXN-GST-(575)-6009-6026 dtd 13th March 2019 valid from 14-09-2018 in para 5 provides that in case a consignment of goods is accompanied with an invoice or any other specified document and also an e-way bill, proceedings under section 129 of the CGST Act may not be initiated in case of minor mistakes like error in one or two digits/characters of the vehicle number. Further Para 6 of the said circular states that in case of minor errors mentioned in Para 5, penalty to the tune of ₹ 500/- each under section 125 of the CGST Act and the respective HPGST Act should be imposed (₹ 1000/- under the IGST Act) in FORM GST DRC-07 for every consignment.

Keeping in view, the Appellate Authority has set aside the order of Assistance Commissioner on the ground that the standard operating procedure as mentioned in Circular 64/38/2018 dated 14.09.2018 was not taken into consideration while imposing penalty in the instant case. The additional demand deposited by the appellant may be refunded and the penalty of ₹ 500/- under SGST and ₹ 500/- under CGST  under section 125 of CGST/HPGST Act, 2017 is imposed on the taxpayer in accordance to GST Circular.

Conclusion:

The minor mistakes in Part-B of the e-way bill, inter-alia "error in one or two digits/characters of the vehicle number" will not invite detention order in view of Circular No 64/38/2018-GST Dated 14.09.2018. Only a penalty of ₹ 1000/- (CGST- ₹ 500/- & SGST-₹ 500/-) will become due to payable.