TMI Blog2019 (10) TMI 665X X X X Extracts X X X X X X X X Extracts X X X X ..... fiscation under section 130 of the CGST Act, the officer adjudging it will have to state as to which clause of sub-section (1) of section 130 of the CGST Act is attracted in the facts of the said case. In the present case, the impugned order is totally silent as regards which provision of the Act or the rules has been contravened; which clause of sub-section (1) of section 130 of the CGST Act is attracted in the present case; and as to why the officer adjudging it has come to the conclusion that there is contravention of the provisions of the Act and the rules made thereunder with the intent to evade payment of tax. Sub-section (2) of section 130 of the CGST Act provides that the fine leviable shall not exceed the market value of the goods, less the tax chargeable thereon. It is, therefore, clear that the fine provided under the first proviso to sub-section (2) of section 130 of the CGST Act is the maximum fine leviable. Consequently, the proper officer adjudging the case is required to examine the seriousness of the contravention and impose fine accordingly. It is not as if in every case the proper officer should levy the maximum fine. The order of confiscation should, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to station the conveyance carrying goods at Vagharol at his risk and responsibility. Thereafter, a notice dated 21.8.2019 came to be issued in Form GST MOV-10 for confiscation of the goods or conveyance and levy of penalty under section 130 of the Central Goods and Service Tax Act, 2017 (hereinafter referred to as the 'CGST Act') read with the relevant provisions of other related statutes. In terms of the said notice, the petitioner was directed to appear before the second respondent on 28.8.2019 at 11 a.m. Thereafter, without waiting for the petitioner to appear before him, the second respondent vide order dated 24.8.2019 passed an order of confiscation under section 130 of the CGST Act in Form GST MOV-11 computing the tax, penalty, fine in lieu of confiscation of goods and fine in lieu of confiscation of conveyance. Being aggrieved, the petitioner has filed the present petition. 5. Mr. Kavi Patel, learned advocate for Mr. D.K. Puj, learned advocate for the petitioner submitted that after the conveyance with the goods came to be intercepted and detained, petitioner has deposited the amount of fine and penalty on 5.9.2019. A copy of the payment receipt of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f goods or conveyances and levy of penalty. Sub-section (4) thereof provides that no order for confiscation of goods or conveyance or for imposition of penalty shall be issued without giving the person an opportunity of being heard. In the present case, on a perusal of the documents annexed along with the petition it appears that pursuant to the notice dated 21.8.2019 issued by the respondent, the petitioner appeared before the respondent on 24.8.2019 and showed willingness to pay the amount of tax and penalty for the purpose of securing release of the vehicle in question. Thereafter, the second respondent, without affording any opportunity of hearing to the petitioner as contemplated under sub-section (4) of section 130 of the CGST Act, has proceeded to pass the impugned order on 24.8.2019. It appears that merely because the petitioner appeared before the respondent and showed willingness to pay the tax and penalty for the purpose of securing release of the vehicle in question, the second respondent has proceeded to pass the impugned order without hearing the petitioner on the question of confiscation of the goods and conveyance. 9. As can be seen f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Act or the rules made thereunder with intent to evade payment of tax; or ( ii) does not account for any goods on which he is liable to pay tax under this Act; or ( iii) supplies any goods liable to tax under this Act without having applied for registration; or ( iv) contravenes any of the provisions of this Act or the rules made thereunder with intent to evade payment of tax; or ( v) uses any conveyance as a means of transport for carriage of goods in contravention of the provisions of this Act or the rules made thereunder unless the owner of the conveyance proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any, and the person in charge of the conveyance, then, all such goods or conveyances shall be liable to confiscation and the person shall be liable to penalty under section 122. 12. Thus, in terms of clauses (i) and (iv) of sub-section (1) section 130 of the CGST Act, the goods can be confiscated provided that the person supplies or receives goods in contravention of the provisions of the Act or the rules made t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly silent as regards which provision of the Act or the rules has been contravened; which clause of sub-section (1) of section 130 of the CGST Act is attracted in the present case; and as to why the officer adjudging it has come to the conclusion that there is contravention of the provisions of the Act and the rules made thereunder with the intent to evade payment of tax. 14. Moreover, a perusal of the impugned order reveals that fine determined in lieu of confiscation of goods is equal to the market value of the goods viz. ₹ 6,81,556/-. Reference may therefore be made to sub-section (2) of section 130 of the CGST Act, which reads thus: ( 2) Whenever confiscation of any goods or conveyance is authorised by the Act, the officer adjudging it shall give to the owner of the goods an option to pay in lieu of confiscation, such fine as the said officer thinks fit: PROVIDED that such fine leviable shall not exceed the market value of the goods confiscated, less the tax chargeable thereon. PROVIDED FURTHER that the aggregate of such fine and penalty leviable shall not be less than the amount of penalty leviab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y exercise of judicial and quasi-judicial or even administrative power. ( e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations. ( f) Reasons have virtually become as indispensable a component of a decisionmaking process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies. ( g) Reasons facilitate the process of judicial review by superior courts. ( h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-making justifying the principle that reason is the soul of justice. ( i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r itself. Such rule being applicable to the administrative authorities certainly requires that the judgment of the court should meet with this requirement with higher degree of satisfaction. The order of an administrative authority may not provide reasons like a judgment but the order must be supported by the reasons of rationality. The distinction between passing of an order by an administrative or quasi-judicial authority has practically extinguished and both are required to pass reasoned orders. 18. In Tata Engineering Locomotive Co. Ltd. v. Collector of Central Excise, Pune , 2006 (203) ELT 360 (SC) , the Supreme Court was dealing with a case where by a cryptic and non-speaking order, the Tribunal had upheld the order passed by Commissioner by applying the ratio of the decision of the Larger Bench in TISCO Ltd., without recording any findings of fact. The court held that it is not sufficient in a judgment to give conclusions alone but it is necessary to give reasons in support of the conclusions arrived at. The court, set aside the order of the Tribunal as the findings recorded by the Tribunal were cryptic and non-speaking, and remitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ussed hereinabove, after affording reasonable opportunity of hearing to the petitioner. 22. The record further reveals that subsequently, on 5.9.2019, the petitioner has deposited the amount of tax and penalty. Therefore, pending the proceedings before the proper officer, the court deems it fit to direct the respondents to release the conveyance with the goods contained therein, subject to the final outcome of the proceedings under section 130 of the CGST/GGST Act. 23. In the light of the above discussion, the petition succeeds and is accordingly allowed. The impugned order dated 24.8.2011 passed by the second respondent is hereby quashed and set aside. The matter is restored to the file of the second respondent to decide the same afresh in accordance with law, after affording a reasonable opportunity of hearing to the petitioner. Needless to state that the second respondent shall pass a reasoned order keeping in mind the statutory provisions as discussed hereinabove. 24. In view of the fact that the petitioner has already deposited the amount of tax and penalty as computed by the second respondent, the conveyance as well as the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X
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