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M/s Ramdev Trading Company And Another Versus State Of U.P. And 3 Others

2017 (12) TMI 341 - ALLAHABAD HIGH COURT

Detention of goods - absence of Transit Declaration Form (TDF) - mis-description of goods - Refined Palm Oil - penalty - Section 129(1) of UP GST Act - Held that: - at the stage of seizure the detaining authority had not applied his mind, nor formed any opinion as to intention to evade tax. The only allegation made in the seizure order is to the effect that the TDF is absent and that the goods have been mis-described. There is no allegation whatsoever as to the intention of the petitioner to eva .....

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d near the exit point in the State of U.P. and there is no allegation that the goods were being or had been unloaded inside the State of U.P. - the goods were infact being transported from Rajasthan to Assam as disclosed in the Tax Invoice and other documents found accompanying the goods - breach was purely technical. - Mis-description of goods - Held that: - the goods (whatsoever their correct description be) had originated from outside the State and were being transported outside the State .....

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. For the Petitioner : Shubham Agrawal For the Respondent : C.S.C.,A.S.G.I. ORDER Heard Shri Shubham Agrawal, learned counsel for the petitioner and Shri C.B. Tripathi , learned Standing Counsel for the department. This writ petition has been filed by the consignor of the goods to challenge the order dated 03.11.2017 passed by the respondent no.4, Assistant Commissioner, U.P. Goods & Services Tax, Mobile Squad-II, Gorakhpur, under Section 129(1) of the U.P. GST Act(hereinafter referred to as .....

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377; 2,37,500 to the same purchaser M/s S.G. Enterprises at Assam, in which IGST @ 5 per cent is disclosed to have been charged. The aforesaid goods appear to have been consigned for transportation on truck bearing registration no. RJ07GB4874. The petitioner claims that these goods loaded on the aforesaid truck were passing through the State of U.P. being a transit state; that they entered U.P. on 1st of November 2017 and had reached 'Gorakhpur' and that the goods and truck were intercep .....

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he detaining authority was not satisfied as to the identity of the goods being same as that mentioned in the tax invoice with respect to the Palm Oil. According to the detaining authority, the goods were 'Ujala Shudh Deshi Ghee'. The petitioner on it's part stated that due to inadvertent mistake on part of the truck driver, transit declaration form had not been downloaded and therefore, it was not found accompanying the goods. However, it is the case of the petitioner that undisputed .....

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physical verification the goods mentioned in the invoice no. 51 as 'Refined Palm Oil' were found to be different being' Ujala Shudh Deshi Ghee'. Thereafter, it appears that a show-cause notice issued to the petitioner on the same day i.e. 03.11.2017 proposing to impose penalty under Section 129 (3) of the Act. In that show-cause notice also there are only two allegations i.e. of the TDF being absent and on physical verification different goods being found in place of 'Refine .....

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y are the absence of TDF as also the different identity of the goods namely 'Ujala Shudh Deshi Ghee' having been found in place of Refined Palm Oil. It has also been mentioned for the first time that the assessee had intention to evade payment of tax with the object of selling the goods inside the State of U.P. At the outset, Shri C.B. Tripathi, learned counsel for the revenue has raised a preliminary objection as to the maintainability of the writ petition in view of alternative remedy .....

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n notified recently on 24.11.2017. Considering the fact that the appellate authority had not been notified when goods were seized on 03.11.2017 or which penalty was imposed on 08.11.2017 and further, considering the fact that upon this writ petition being entertained, instructions had been sought and a short counter affidavit filed by the State, this writ petition is being disposed of in view of peculiar facts of this case, at this stage, with the consent of parties. In view of the above, the ba .....

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it is not only necessary for the revenue to establish that there is a technical violation of the Act and/or the Rules framed thereunder but that such a violation has a revenue impact inasmuch as the revenue is burdened to specifically allege and establish that the alleged violation of the Act and/or the Rules, as may be alleged, has been caused by the assessee with intention to evade payment of tax. It is thus submitted that in the instant case the first real allegation that arises is the absen .....

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goods have been seized at 'Gorakhpur', which undeniably is the border district of the State of U.P. with State of Bihar. The revenue also does not contend or allege that the goods had been loaded from inside the State of U.P. Thus, by necessary implication, the revenue admits that the goods have originated from outside the State of U.P., in this case Rajasthan, as disclosed by the petitioner. He therefore, submits that mere absence of the TDF could not have led to an automatic inference .....

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ds. Though all other documents were found accompanying to support the contention of the assessee that the goods were merely passing through the State of U.P. Then, as to the difference in the identity of the goods namely Refined Palm Oil as alleged by the revenue, learned counsel for the petitioner submits that in the first place there is no difference as alleged inasmuch as on the packing a different description has been mentioned but the real identity of the goods is as described in the tax in .....

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U.P. passed through it without being sold or consumed or unloaded in the State of U.P. In such a case by very nature of the transaction no tax could be imposed by the State of U.P. for any goods passing through it though there may be some error, mistake or wrong even if description of such goods. It would be of very little consequence as the proper officer may, if satisfied as to the difference/discrepancy in the description of the goods may make an appropriate endorsement to that effect on the .....

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rred in another vehicle and no explanation in this regard has been given is irrelevant. What had been happened prior to the arrival of the vehicle at the entry check post is wholly irrelevant. The objection of the check post officer that a different goods were found than the goods mentioned in the challan is also baseless. Perusal of the challan shows that the goods mentioned is cereal Based Blanded Food (Sattu). Show cause notice says that on verification it was found that in the packing, const .....

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It may be that Cereal Based Blanded Food, is called as sattu at Rajasthan but in the State of U.P. may be understood differently. Since in the invoice the name "Cereal Based Blanded Food" is mentioned and the same was also found with reference to its constituent namely wheat, soyabeen, sugar, vitamin and mineral, it can not be said that a different item was found than the item mentioned in the invoice. No difference in the quantity was found. Even assuming if according to the check po .....

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om Rajasthan and was going to Uttaranchal and was not intended for import inside the State of U.P. The provision of section 28-A of the Act is not applicable. The inference of an intent to evade tax is based on suspicion and merely on surmises and conjectures and on irrelevant consideration. Therefore, the check post officer has erred in refusing to issue transit pass and seizing the goods and the Tribunal has erred in confirming the seizure of the goods." Reliance has also been placed on a .....

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d that the goods were different from the goods declared in documents produced for obtaining transit form. In view of the above, the validity of the seizure itself becomes doubtful and as such the imposition of penalty on the ground of seizure can not also be justified. It may be noted that it is not the case of the department that the goods as per the transit pass were unloaded within the State of U.P. or found to be different or not tallying with those mentioned in the form or that they were no .....

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to seizure and penalty the moment there is a violation of the Act or the Rules. In so far as it is not disputed that the transaction involved transit of goods through the State of U.P. the goods should have been accompanied with TDF, over and above the Tax Invoice and other documents of transportation of goods. The contravention was thus complete and no further fact or intention was required to be established by the revenue to either seize the goods or impose the penalty. In this regard, Shri C .....

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the assessee had intention to evade tax inasmuch as the penalty order specifically alleges that the assessee had conducted the transaction in the manner so as to unload the goods inside the State of U.P. in the garb of transit through the State of U.P. Having considered the arguments so made by the learned counsel for the parties, we find that at the stage of seizure the detaining authority had not applied his mind, nor formed any opinion as to intention to evade tax. The only allegation made i .....

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on up to the stage of issuance of the penalty show-cause notice, therefore, appears to be that the petitioner had contravened the provisions of the Act and therefore exposed itself to the penalty. However, in the penalty order, almost in the passing the respondent no.4 has recorded that the petitioner had intention to evade tax by unloading the goods inside the State of U.P. However, as a fact petitioner has not been found to have unloaded the goods. Also, neither such allegation was made agains .....

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