The petitioner is registered as a dealer under the Delhi Service Tax Act, and is engaged in, amongst others, trading and importing of hand held walkie-talkie sets. The petitioner has filed this petition impugning

The orders dated 20.02.2019 under the provisions of Section 129(3) of the Karnataka Goods and Service Tax Act, 2017 (for short, ‘the KGST Act’) in JCCT (VIG)/CTO(VIG)- 40/SRS/INS-15/2018-19 (Annexure – A2) and JCCT(VIG)/CTO(VIG)-40/SRS/INS-16/2018-19 (Annexure A3), and the subsequent orders dated 21.12.2090 in the corresponding appeal proceedings under Section 107(11) of the KGST Act in GST.AP.17/18-19 (Annexure-A1) and GST.AP.18/18-19 (Annexure-A) by the second respondent.

The petitioner asserts that it imports walkie-talkie sets only for supply to the Police and the other Government Security Departments across India. A consignment of these walkie-talkies is imported from M/s JVC Kenwood Corporation, Japan and dispatched to Bangalore Airports Custom Authority from SingaporeAirport. The petitioner has obtained clearance from the Customs Authority after paying applicable IGST and basic customs duty as provided in the Bills of Entry

However, the present dispute is because the CTO has commenced proceedings under section 129 of the KGST Act culminating with the impugned orders after the Commercial Tax Officer (Vigilance-40), Bengaluru (for short, ‘the CTO’) detained one of the vehicles viz., the vehicle bearing bearing Registration No KA-04-AB-9470 (for short, ‘the vehicle’) hired by the petitioner for transportation of these walkie-talkie sets (for easy reference, ‘the consignment’)

According to the CTO, the driver on interception of the Vehicle could produce only two Commercial Invoice copies and two Delivery Challan copies but could not furnish the prescribed e-way bills. The consignment could not have been moved without generating e-way Bills in view of the provisions of Rule 138 of the Karnataka Goods and Services Tax Rules, 2017 (for short, ‘the KGST Rules’) and the subsequent Notification No. FD 47 CSL 2017 Bengaluru dated 06.09.2017

Therefore, the consequences under Section 129 of the KGST Act would have to follow. As such, the CTO on physical verification and issuance of Form GST MOV-02 as well as recording Form GST MOV-04 has detained the Vehicle issuing order of detention in Form GST MOV-06 which is served on the person-in-charge of the Goods on 09.02.2019. Subsequently, the CTO has served notice in Form GST MOV5 07 by affixture on the vehicle after drawing mahazar because the driver, the person-in-charge, refused to accept such notice

The proceedings in JCCT(VIG)/CTO(VIG)- 40/SRS/INS-16/2018-19 is with regard to the transportation of the consignment without e-way bills in the vehicle, and the other proceedings in JCCT (VIG)/CTO(VIG)-40/SRS/INS- 15/2018-19 relates to the vehicle bearing registration No. KA 02 AG 9261,

The petitioner has filed its response dated 08.02.2019 with the Joint Commissioner of Commercial Taxes (Vigilance), Bengaluru placing on record inter alia that the CTO intercepted the vehicle within 3-4 km of Bangalore Airport Customs Office. The driver of the vehicle, because he got the clearance early and everything was found correct, left the premises before the e-way bills were generated. However, the e-way bills were generated before interception. The error is bona fide and unintentional and there was no intention to evade tax

In the appeal under Section 107 of the CGST Act, the second respondent has confirmed the CTO’s orders. The second respondent has concluded that violation of the provisions of Rule 138 of the KGST Rules and the notification issued as regards generation of e-way bills is indisputable in view of the admitted fact that the driver of the vehicle could not produce the e-way bills when the vehicle was intercepted. The second respondent has confirmed the CTO’s conclusion based on the correspondence with M/s Menzies Aviation Security, a security agency at the Bangalore International Airport Authority, as regards the vehicle’s entry and exit from the Airport.