Shiv scrap sales VS State of U.P.

The case involves a dispute between the petitioner, who claims to be a registered dealer under the GST Act, and the respondent revenue. The petitioner asserts engagement in the business of supplying mixed scrap to dealers in various locations. The core argument revolves around the seizure of goods by authorities.

According to the petitioner, the seized goods were dispatched in transit with a valid e-Way bill generated on 14.11.2022, expiring on 17.11.2022. The petitioner maintains that the driver carried the original tax invoice and e-Way bill during transit. However, authorities intercepted the goods at Agra on 15.11.2022, without providing a valid reason for seizure.

The petitioner disputes the grounds for seizure mentioned in Form GST MOV-06, contending that the claim of a fake sale and invoice is unfounded. It is argued that the detention order lacks legality, thereby invalidating the jurisdiction of authorities to proceed under Section 129(3) of the CGST Act 2017.

Additionally, the petitioner asserts that they submitted a claim to the revenue department as the owner of the seized goods. Despite this, a notice under Section 129 of the CGST Act 2017 was issued in the name of the driver. The petitioner contends that all proceedings under Section 129 should involve notice and opportunity for the petitioner, once their claim as the owner is established.

The court notes that the validity of the seizure order, as indicated in Form GST MOV-07, cannot be determined at this preliminary stage. The form suggests that the invoice was for a fake sale, a claim disputed by the petitioner. The court suggests that the remedy available to the petitioner lies in challenging the findings of the seizure order.

In summary, the case centers on the legality of the seizure of goods by authorities under the CGST Act 2017. The petitioner argues that the seizure lacked proper justification and that due process was not followed in issuing notices and conducting proceedings. The court’s attention is drawn to the dispute over the authenticity of the sales invoice and the need for a fair assessment of the circumstances surrounding the seizure.

In the case presented, Sri Aditya Pandey, representing the petitioner, and Sri Ankur Agarwal, representing the respondent revenue, were engaged in a legal dispute. The petitioner claimed to be a registered dealer under the GST Act, involved in supplying mixed scrap to dealers in various locations.

The petitioner argued that the goods seized were sent in transit after the generation of an e-Way bill on November 14, 2022, at 9:43 p.m., which was valid until November 17, 2022. They stated that valid tax invoices and e-Way bills were carried by the driver during transit, and the interception of goods in Agra on November 15, 2022, lacked proper justification. The reason provided for the seizure, that the purchaser firm didn’t exist and the sale was fake, was contested as false. The petitioner contended that the detention order was illegal, thus questioning the jurisdiction of the authorities to proceed under Section 129(3) of the CGST Act 2017.

Moreover, the petitioner had submitted a claim to the revenue department, asserting ownership of the seized goods. However, despite this claim, a notice under Section 129 of the CGST Act 2017 was issued in the name of the driver. The petitioner argued that once they had claimed ownership, all proceedings under Section 129 should involve them and not just the driver.

The court noted these arguments but stated that the validity of the seizure order couldn’t be determined at this stage, referring to findings in FORM GST MOV-07 that the invoice was for a fake sale. The court suggested that the petitioner should approach the competent authority with a proper application, providing details of ownership of the goods in question. However, the court observed that the application appended to the writ petition was undated, and there was no proof of its receipt by the revenue office.

The court disposed of the petition, advising the petitioner to approach the competent officer with a proper application, along with a copy of the court’s order. If such an application is filed, the officer should grant the petitioner an opportunity for a hearing, following the provisions of sub-section (3) of Section 129 of the CGST Act, 2017.

The court clarified that it hadn’t delved into the merits of the petitioner’s claim. This summary encapsulates the main points and recommendations outlined in the court’s decision.

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