TMI Blog2021 (11) TMI 934X X X X Extracts X X X X X X X X Extracts X X X X ..... ner could have had adequate opportunity to represent his case and, subject to such proof as required by clause (v) of sub-section (1) of Section 130 of the Act, would not have been saddled with the liability under sub-sections (2) and (3) of Section 130 of the Act. Therefore, the show cause notice Form GST MOV-10 that was issued was defective which resulted in denial of opportunity to the petitioner, and as such, cannot be said to be a show cause notice in the eyes of law. Thus, not only have the principles of natural justice not been complied with by the respondents, the petitioner has also been prejudiced by such non-compliance. There is no material on record to demonstrate that an opportunity of hearing was duly granted to the petitioner as is the mandate of sub-section (4) of Section 130 of the Act. The order passed by the Additional Commissioner Grade II (Appeal)-I, State Tax, Agra as well as the order dated 29.11.2020 Form GST MOV-11 passed by the Assistant Commissioner (Mobile Squad) Unit-2, Commercial Tax, Agra cannot be sustained and are hereby quashed - Petition allowed. - Writ Tax No. - 650 of 2021 - - - Dated:- 15-11-2021 - Hon'ble Jayant Banerji, J. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... V-10 contains the date for appearance of the petitioner as 28.11.2020, which is prior to the date of issuance of the aforesaid notice. On 29.11.2020, an order in Form GST MOV-11 for confiscation of the vehicle of the petitioner was issued and penalty and fine were imposed. The aforesaid order of confiscation was challenged by the petitioner in an appeal under Section 107 of the Act, which came to be dismissed by the order impugned dated 28.06.2021. The contention of the learned counsel for the petitioner is that clause (v) of sub-section (1) of Section 130 of the Act provides for confiscation of goods or conveyance in case any persons uses any conveyance as a means of transport for carriage of goods in contravention of the provisions of the Act or the rules made thereunder, but, this is subject to the owner of the conveyance proving that it was so used without the knowledge or connivance of himself, his agent and the person in charge of the conveyance. It is further contended that the notice in Form GST MOV-10 and the order passed in Form GST MOV-11, are wholly illegal and in gross violation of the principles of natural justice, inasmuch as the date mentioned in the show cause n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case, this Court, in exercise of its jurisdiction under Article 226 of the Constitution of India, may be pleased not to interfere in the matter. It is contended that the third proviso to sub-section (2) of Section 130 of the Act provides that the owner of a conveyance be given an option to pay in lieu of the confiscation of the conveyance, a fine equal to the tax payable on the goods being transported thereon. It is contended that the interception admittedly took place on 08.10.2020 and the physical verification was done on 14.10.2020 and at the time of physical verification, the signature of the driver namely, Taiyyab, was taken as is appearing from a perusal of the Form GST MOV-4 that has been filed as Annexure-CA-1 to the counter affidavit. On 31.10.2020, the seizure order was passed in Form GST MOV-9 and it was on 17.12.2020 that an application was filed before the SHO for lodging of an FIR. It is contended that in case the petitioner was aggrieved by the order of seizure or wanted to avail of the benefit available to the owner of the conveyance in clause (v) of sub-section (1) of Section 130 of the Act, he could have demonstrated so from his conduct immediately after the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dents in the counter affidavit that there is any typographical or clerical error in Form GST MOV-10. Only a statement has been made in paragraph no. 11 of the counter affidavit that a notice dated 21.11.2020 in Form GST MOV-10 was issued, but no copy thereof has been enclosed. On behalf of the petitioner, legal notices were sent to the respondent no.3 as well as to the transporter that were dispatched on 05.12.2020 and 07.12.2020 respectively. In the notice to the respondent no.3 a protest was lodged regarding the seizure of the conveyance (truck) and denying any involvement with the incident and claiming innocence. In the notice to the transporter, it was stated that the conduct in carrying objectionable goods in the truck and without the petitioner's knowledge and permission is an act of fraud, criminal breach of trust and criminal conspiracy, and return of the truck was demanded. On 17.12.2020 an information was submitted to the SHO of Police Station Alipur, Delhi requesting him to lodge an FIR against the transporter. Thereafter, it appears that when no steps were taken by the police, a communication was sent to the Commissioner of Police, New Delhi to register the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 authorised 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, 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 leviable under sub-section (1) of section 129: Provided also that where any such conveyance is used for the carriage of the goods or passengers for hire, the owner of the conveyance shall be given an option to pay in lieu of the confiscation of the conveyance a fine equal to the tax payable on the goods being transported thereon. (3) Where any fine in lieu of confiscation of goods or conveyance is imposed under sub-section (2), the owner of such goods or conveyance or the person referred to in sub-section (1), shall, in addition, be liable to any tax, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tial prerequisite and an inalienable and inherent right of the person proceeded against under Section 130 of the Act. The Supreme Court in the case of Dharampal Satyapal Ltd. v. Deputy Commissioner of Central Excise and Ors. (2015) 8 SCC 519 has observed as follows:- 27. It, thus, cannot be denied that the principles of natural justice are grounded in procedural fairness which ensures taking of correct decisions and procedural fairness is fundamentally an instrumental good, in the sense that procedure should be designed to ensure accurate or appropriate outcomes. In fact, procedural fairness is valuable in both instrumental and non-instrumental terms. 28. It is on the aforesaid jurisprudential premise that the fundamental principles of natural justice, including audi alteram partem , have developed. It is for this reason that the courts have consistently insisted that such procedural fairness has to be adhered to before a decision is made and infraction thereof has led to the quashing of decisions taken. In many statutes, provisions are made ensuring that a notice is given to a person against whom an order is likely to be passed before a decision is made, but there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will depend on facts and circumstances of the case. .................. 40. In this behalf, we need to notice one other exception which has been carved out to the aforesaid principle by the courts. Even if it is found by the court that there is a violation of principles of natural justice, the courts have held that it may not be necessary to strike down the action and refer the matter back to the authorities to take fresh decision after complying with the procedural requirement in those cases where non-grant of hearing has not caused any prejudice to the person against whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that the order passed is always null and void. The validity of the order has to be decided on the touchstone of prejudice . The ultimate test is always the same viz. the test of prejudice or the test of fair hearing. In the light of the aforesaid decision, the present case has to be considered. The facts and circumstances narrated above reflect that the show cause notice dated 23.12.2020 was misleading and incorrect. Where a show cause notice in Form GST MOV-10 is issued, which is a preclude t ..... 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