TMI Blog2020 (2) TMI 892X X X X Extracts X X X X X X X X Extracts X X X X ..... (e way bill is one of them). The instant appeal is accepted and the order passed by Assistant Commissioner State Taxes Excise-cum- Proper Officer, North Enforcement Zone Palampur dated 27.11.2018 is set aside - The tax and penalty deposited by the appellant under section 129 (1) may be refunded and a penalty of Rs Ten Thousand only is imposed on the taxpayer under section 122 (1) of the Act. - EXN-005/2019-GST-2992-97 - - - Dated:- 12-2-2020 - (ROHIT CHAUHAN) ADDL. COMMISSIONER STATE TAXES EXCISE(GR-1) HIMACHAL PRADESH Parties represented by:- 1. Sh. N. K. Thaman, Advocate for the appellant. 2. Shri. Kishore Kumar, ACST E-cum-Proper Officer for the Department. Appeal under Section 107 of CGST Act, 2017 and HPGST Act, 2017 read with rule-108 of Himachal Pradesh Goods Services Tax Rules, 2017. ORDER 1. At the outset, I would like to make it clear that the provisions of both the Himachal Pradesh Goods and Service Tax Act, 2017 and Central Goods Service Act, 2017 (hereinafter referred to as HPGST and CGST Act respectively) are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The statement of driver of the truck was recorded in GST MOV-01 having Reference No. NEZ-03/30-10-18. Further, the order for physical verification/inspection was passed in GST MOV-02 having Reference No. NEZ-03/30-10-18 on the reasoning that E-way bill was not tendered for auto slave machine being transported in inter-state movement for repairs of value worth ₹ 3,89,400/- . Thus, the value of machine was taken by the officer from the copy of purchase invoice enclosed with the delivery challan by the appellant. The physical verification report was prepared in GST MOV-04 having Reference, No. NEZ-03-30-10-18 and machine was found to be as per description mentioned in the delivery challan and no discrepancy was found during physical verification. The self-certified copies of GST MOV-1, GST MOV-2 and GST MOV-04 are enclosed in this regard. 6. The above machine along with conveyance was detained due to non-availability of E-way bill and detention order in GST MOV-06 having Reference NO. NEZ-03/30-10-18 was served. Further, notice under Section 129 (3) of CGST/HPGST Act, 2017 was issued in GST MOV-07 having Reference No. NEZ-03/30-10-18 giving options under Section 129 (1) i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rule 138 (10 (ii) (b) Activity to send goods for job work or repairs does not come under definition of supply is not relevant in your case a notice was issued to you for not generating E-way bill for reasons other than supply. You may be engaged in supply of exempted goods which is not relevant in your case. (c) Your goods i.e. Auto Clave machine is not in e-way bill exempted list and attracts penalty under Section 129 (1) (a) of the Act. 10. The appellant vide their letter dated 17-11-2018 requested the adjudicating authority to pass a speaking and appealable order in GST MOV-09 under Section 129 (3) of CGST/HPGST Act, 2017 after considering the submissions already made vide their letter dated 20-11-2018. 11. The Ld. Adjudicating authority passed an order in GST MOV-09 on 27-11-2018. However, only preamble of the order was provided to the appellant. In this preamble, it is mentioned that order enclosed , but no order was enclosed with the preamble. Vide this order, IGS of ₹ 59,400/- and penalty of ₹ 59.400/- has been confirmed against the appellant. However, no opportunity of personal hearing was afforded to the appellant to explain their case as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard. 3) Without prejudice to above, even on merits, the impugned order is not sustainable. The appellant is filling appeal based on abjection rose in letter dated 26-11-2018 of the adjudicating authority due to non-receipt of operative part of GST MOV-09. The appellant reserve their right to file additional submissions on receipt of operative portion of the order. 4) The Ld. Adjudicating authority has failed to consider that there is no applicable tax under Section 129 (1) of CGST Act, 2017 as made applicable to inter-state supply as per Section 20 of IGST Act, 2017 since the activity to send goods for repair does not attract GST as not covered under the definition of supply , hence the confirmation of demand of GST and imposition of equal penalty as per the provisions of Section 129 910 (a) of CGST/HPGST Act, 2017 is not sustainable. 4.1) The Id. Adjudicating authority while passing order u/s 129(3) of CGST/ HPGST Act, 2017 has wrongly confirmed IGST and imposed equal penalty as per Section 129 (1) (a) ibid. It is an accepted fact that the appellant had sent faulty Auto clove machine for repair as per details mentioned in the statement of facts above. The c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value in a financial year by an employer to an employee shall not be treated as supply of goods or services or both. 3 Supply of goods- (a) by a principal to his agent where the agent undertakes to supply such goods on behalf of the principal; or (b) by an agent to his principal where the agent undertakes to receive such goods on behalf of the principal. 4. Import of services by a 3 person from a related person or from any of his other establishments outside India, in the course or furtherance of business. The machinery sent for repair is not covered under Schedule-1 above. Further, no consideration is involved in sending faulty auto clove machine for repair to its manufacturer. Thus, from the above provisions, it is concluded that machinery sent for repair is not covered under the definition of supply and does not attract GST. 4.2) That, Section 129 (1) ibid [discussed in detail in the succeeding para.), provides that detention is to be released on payment of applicable tax and penalty equal to one hundred percent of tax payable on such goods. In the present case, when GST is not attracted in the transaction as not covered under the definition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount 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 there under 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 provision of this Act or the rules made there under 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. (2) Whenever confiscation of any goods or conveyance is authorized by this 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, les the tax chargeable thereon: Provided further that the aggregate of such fine and penalty levi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntent to evade GST. When there is no intention to evade payment of GST, no confiscation is warranted under section 130 ibid, consequently, no detention under Section 129 ibid is sustainable. The non-issuance of e-way bill in such a situation is only a procedural lapse without any revenue implication or loss to the deportment, which merits to be condoned considering it a case of bona fide mistake on part of appellant as engaged in supply of exempted goods. Thus, the impugned order wrongly demanding GST and imposing equal penalty is not sustainable and merits to be set aside. The Id. Adjudicating authority has failed to consider that the appellant was under bonafide belief that e-way bill is not required as they are engaged in the supply of exempted goods i.e. plants and as per Rule 138 (14) (E) of CGST Rules, 2017 they are not required to issue e-way bill. As discussed in statement of facts, the appellant is engaged in plantation business. The plants falling in Chapter 6 of the Customs Tariff are exempt from GST as per serial number 34 of Notification No. 02/2017-Central Tax (Rate) dated 28-06-2017. Similar notification has been issued under IGST Act and HPGST Act. As per Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is required in case of other than supply. But their submission is that there is no applicable tax as required in Section 129 (1) ibid, in view of fact that sending capital good for repair is not a supply. Since there is no applicable tax, no demand of GST can be made in the present case and no penalty equal to GST can be imposed. Further, no detention is contemplated where there is not intent to evade duty as per the provisions of Section 129 (6) and 130 (1) ibid. Further, the appellant had given reference of no requirement of e-way bill since they are engaged in exempted supply and it is to show their bonafide belief in non-issuance of e-way bill along with disputed transaction. Thus, the grounds taken in above letter are against the legal provision o the issue as discussed in the preceding paras. The impugned order passed without considering the legal provisions is not sustainable and the same merits to be set aside. The above grounds are independent and without prejudice to one another. The appellant seeks leave to add or withdraw any of above grounds as when consider necessary Relief Claim: In view of above, it is respectfully prayed that the Ld. Additional C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eason other than supply as stated in Rule 138 (1) (ii) of F-way bill rules. Pt. No. 7: Rule 138 of the CGST/HPGST Rules, 2017 states that every registered person who causes movement of goods (which may not necessarily be on account of supply) of the said consignment value is required to furnish above mentioned information in part A of the E-way bill and Transporter will give details in Part B. A registered person sending Auto cloves machine for repair or job work, interstate supply of goods or other than supply of goods has not covered under E-way bill exempted list and the consignment of Auto cloves machine attracts penalty under section 129 (1) of the Act. That rule 138 of CGST/HPGST Rules, 2017 provides for the E-way bill mechanism and in this context it is important note that information is to be furnished prior to the commencement of movement of goods: and is to be issued whether the movement is in relation to a supply or for reasons other than supply. That the order passed by the proper officer IS under the provision of law of CGST and SGST Rule, 2017. xxxxxxxxxxx 16. After hearing both the parties in detail it appears that the disputed goods were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase invoice for determining the tax and penalty in this case under section 129(1) of the Act. The method used for valuation of transaction is not just and proper as the disputed goods were old and were dispatched for repair. 21. As there is no doubt that the taxpayer has violated the provisions of the CGST/HPGST Act, 2017, so is liable to pay penalty. The tax payer has transported goods without the cover of proper documents (e way bill is one of them). In this regard, attention is invited toward section 122 of the CGST/HPGST Act that can come into play in the instant case which provides: 122. (1) Where a taxable person who- (i) supplies any good9ir services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply; (xiv) transports any taxable goods without the cover of documents as may be specified in this behalf; he shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evaded or the tax not deducted under section 51 or short deducted or deducted but not paid to the Government or tax not collected under section 52 or short collected or collected but not paid to the Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X
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