Harley Foods Products Private Limited VS The State Of Uttar Pradesh

The court session commenced with Sri Suyash Agarwal, representing the petitioner, presenting their case. Following him were Sri C.B. Tripathi, the learned Special Counsel for the State, and Sri Anant Kumar Tiwari, the learned counsel representing the Union of India. The matter at hand is a writ petition filed by the petitioner, seeking various reliefs concerning actions taken under the UPGST Act.

The petitioner has sought the following reliefs:
A. Quashing of the seizure memo dated 25th March 2018 passed under Section 129(1) of the UPGST Act by Respondent No. 4.
B. Quashing of the notices dated 25th March 2018 issued under Section 129(3) of the UPGST Act by Respondent No. 4.
C. Quashing of Commissioner Circular No. 2899 dated 6th February 2018 as ultra vires to the UPGST Act, 2017.
D. Any other writ, order, or direction deemed fit by the Hon’ble Court in the facts and circumstances of the case.
E. Awarding costs of the petition to the petitioner.

The case involves a company registered under the Companies Act and the GST Act, located in Ahmadabad, Gujarat. The petitioner had supplied printed laminated rolls worth Rs. 7,84,564/- and Rs. 4,37,588/- through two separate invoices, charging Integrated Goods and Service Tax (IGST) at a rate of 18%. The goods were transported via Truck No. DL-1GB-7369 under Consignment Note No. A 89423 dated 21st March 2018, issued by the transporter. The seller in Gujarat had also generated a Gujarat e-way bill on 21st March 2018, complying with the Gujarat GST provisions for the outward journey from Ahmedabad to Meerut, Uttar Pradesh. However, upon reaching near Baghpat, Uttar Pradesh, on 24th March 2018, at approximately 3:30 PM, the vehicle was intercepted and detained by respondent no. 4, the Assistant Commissioner, State Tax, Mobile Squad, Unit Baghpat. A detention notice was issued to the truck driver, stating the absence of e-way bill-01 at the time of interception, despite other documents being presented during verification.

The petitioner contends that the actions taken by respondent no. 4 were unwarranted and seeks relief through the writ petition. They argue that the detention and subsequent notices were improper, especially considering the compliance with e-way bill regulations and other relevant documents. The petitioner’s case revolves around challenging the legality and validity of the seizure memo, notices, and the circular issued by the Commissioner, alleging them to be ultra vires to the UPGST Act.

In response, the respondents are expected to defend their actions, justifying the interception and detention based on alleged non-compliance with the e-way bill requirements. The court will assess the arguments presented by all parties and scrutinize the legality and procedural correctness of the actions taken, determining whether the reliefs sought by the petitioner are warranted under the law.

The case at hand involves a seizure order dated 25th March 2018 passed under Section 129(1) of the UPGST Act, estimating the value of the seized goods at Rs. 10,05,214/-. The seizure was made in the name of the vehicle’s driver, with the authority citing the absence of an e-way bill-01 at the time of interception as the sole ground for the seizure. Respondent no. 4, the seizing authority, presumed that the goods were being transported within the state of Uttar Pradesh with the intention to evade tax payment. Consequently, the petitioner was directed to deposit the tax and furnish a bank guarantee under Section 129(3) of the Act, amounting to Rs. 11,86,253/- for the release of the seized goods and vehicle.

The counsel representing the petitioner argues that under Rule 138 of the UPGST Rules, 2017, Notification No. KANI-1014/XI-9(52)/17-UPGST Rules-2017-Order(31) 2017 Lucknow dated 21st July 2017 specifies the required forms for the movement of interstate and intrastate goods, including e-way bills. They further highlight amendments made under Section 164 of the UPGST Act, 2017, read with Section 21 of the UP General Clause Act, through Notification No. Order(45)-2017 dated 20th September 2017, which substituted Clause 10 of the notification, thereby amending Rule 138. Additionally, Notification No. 138 dated 30th January 2018, issued under Section 164 of the UPGST Act, brought into force serial numbers 10 and 11 of Notification No. 1359 dated 20th September 2017, effective from 1st February 2018.

The petitioner’s counsel argues that these notifications and amendments provide the legal framework for the issuance and compliance of e-way bills, suggesting that the absence of an e-way bill-01 should not be the sole grounds for seizure. They imply that the authorities did not adhere to these provisions correctly when seizing the goods and vehicle.

In response, the respondents are expected to counter these arguments, defending the actions taken under Section 129 of the UPGST Act and justifying the seizure based on non-compliance with e-way bill requirements. The court will likely assess the validity of the seizure and the interpretation of relevant provisions and notifications to determine whether the petitioner’s rights have been violated. The outcome may hinge on whether the seizure was conducted in accordance with the law and whether the petitioner was afforded due process.

The counsel representing the petitioner has drawn attention to a series of notifications and amendments concerning the UPGST Act, which have a direct bearing on the case. They highlight that Notification No. 1359 dated 20th September 2017, which came into effect on 1st February 2018, supersedes Notification No. 1014 dated 21st July 2017. This implies that the regulations introduced under Notification No. 1014, including the forms for e-way bills, were effectively replaced by the provisions of Notification No. 1359.

Additionally, the counsel points out the issuance of Notification No. 155 dated 31st January 2018, which further amended the UPGST Rules under Section 164 of the UPGST Act. Amendment No. 12 specifically addresses Rule 138, stating that e-way bills generated under this rule or under Rule 138 of the GST of any State shall be valid in every State and Union Territory. This amendment clarifies the inter-state validity of e-way bills generated under the UPGST Rules.

Furthermore, the counsel mentions Notification No. 177 dated 6th February 2018, through which the Governor rescinded Notification No. 138 dated 30th January 2018, with immediate effect. This rescission effectively nullified the provisions introduced under Notification No. 138, including any amendments to Rule 138 and the validity of e-way bills under that notification.

Upon reviewing these notifications, it becomes evident that the initial regulations introduced under Notification No. 1014, which included the specifications for e-way bills, were subsequently rescinded and replaced by subsequent notifications and amendments. This legal context is crucial for understanding the regulatory framework surrounding e-way bills and compliance requirements under the UPGST Act.

The counsel’s argument emphasizes the importance of these notifications in assessing the validity of the seizure and the subsequent actions taken by the authorities. They suggest that the seizing authority may not have correctly applied the updated regulations and amendments when seizing the goods and vehicle in question. Thus, the court’s decision may hinge on whether the actions of the authorities were in accordance with the amended regulations and notifications governing e-way bills under the UPGST Act.

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