Petitioner | Smeara Enterprises |
Respondent | State Tax Officer |
Decision by | Kerala High Court |
Date of order or Judgement | 11-November-2019 |
Citation no. | 2019 (11) GSTPanacea 3 HC Kerala |
Hon’ble Judge | Justice C.K. Abdul Rehim |
Decision | In Favour of Revenue |
Furnishing Bank Guarantee-Unless the security as contemplated is furnished or payment of the entire amount of tax and penalty imposed is made, the goods are not liable to be released.
Furnishing Bank Guarantee-Facts of the Case
Challenge raised in this writ petition was against order passed by the Assistant State Tax Officer, under section 129(3) the Act imposing tax and penalty to the tune of Rs. 1,15,333/-.
It is complained that the impugned order was passed by the above said authority without properly appreciating the explanations offered in this regard.
Argument Before Court
Furnishing Bank Guarantee-Petitioner’s Contention
The Petitioner submitted that the goods detained under section 129(1) was only ‘promotional materials’ consigned by the supplier, not intended for sale, and it will not attract any tax liability as contemplated under section 7 of the GST Act.
The Petitioner had already filed a statutory appeal, as provided under section 107 of the Act, after paying 10% of the disputed tax and penalty.
The appellant pleaded for release of the goods, without proceeding with any further steps for confiscation of the same.
Furnishing Bank Guarantee-Respondent’s Argument
The respondent contended that, since the amount of tax and penalty imposed under sub-section 3 of section 129 was not paid, the goods are liable to be proceeded for confiscation, as contemplated under section 130.
The respondents further contended that the goods could be released pending disposal of the appeal only on the appellant furnishing Bank Guarantee for the entire tax and penalty determined.
Kerala High Court Held
Furnishing Bank Guarantee-The Hon’ble Court held that the mere pendency of an appeal cannot be taken as a basis for directing release of the goods, without any security, because non payment of the amount of security would attract proceedings for confiscation of the goods under section 130 of the Act.
Therefore, unless the security as contemplated under section 129(2), read with section 67(6), is furnished with; or payment of the entire amount of tax and penalty imposed under section 3 is made, the goods are not liable to be released.
Therefore the relief sought for the release of the goods, pending disposal of the appeal cannot be entertained.
Consequently, the above writ appeal is disposed of.
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