Petitioner | K.P. Sugandh Ltd |
Respondent | State Of Chhattisgarh |
Decision by | Chattisgarh High Court |
Date of order or Judgement | 16-March-2020 |
Citation no. | 2020 (3) GSTPanacea 3 HC Chattisgarh |
Hon’ble Judge | Justice P.Sam Koshy |
Decision | In Favour of Assessee |
Undervaluation of goods in the invoice cannot be a ground for detention and seizure of the goods and vehicle in transit.
Undervaluation of Goods in Invoice-Facts of the Case
The challenge in the present writ petition is to the order passed by the respondent for the purpose of release of the vehicle carrying goods belonging to the petitioners from the manufacturing center to the dealer. The Petitioner dispatched goods (Pan Masala and Tobacco Products) along with tax invoice and e-way bill to its customer located at Raipur. Despite the fact that necessary documents accompanying the consignment were duly produced, the Officer seized & detained the vehicle and the goods on the ground that there is alleged discrepancy in the valuation of such goods.
Argument Before Court
Undervaluation of Goods in Invoice-Petitioner’s Contention
The Petitioner submitted that Inspite of the Driver of the conveyance producing the necessary invoice bill and the e-way bill the respondent authorities seized the vehicle and the goods. The ground of discrepancies are in the valuation of the goods, resulting in detaining the vehicle and the goods. Subsequently, a notice under Section 129(3) was issued to the driver. Thereafter, the petitioners moved an application for release of the vehicle. It is this order which is under challenge in the present writ petition.
Undervaluation of Goods in Invoice-Respondent’s Argument
The respondent issued a notice under Section 129 to which the petitioners submitted their reply. Since the reply of the petitioners were not convincing, the respondent authorities have passed the order under Section 129. The contention of the petitioners is that the impugned order under Section 129 is one which is appealable under Section 107, therefore the writ petition for this reason itself is not maintainable. The respondent submits that as regards to the discrepancy it has been informed that the price at which product was sold to the customer was not matching the MRP of the product, which reflected in the packet transported.
Chattisgarh High Court Held
Undervaluation of Goods in Invoice-The Hon’ble High Court, after going through the facts of the case held that ‘merely because the manufacturer sells his products to its customers at a price lower than the MRP, as such cannot be made ground on which the product or the vehicle could be seized or detained.’ It was further held that for the price of sale, Inspecting Authorities could have intimated the Assessing Authority for the alleged discrepancy and initiating appropriate proceedings upon Petitioner. This Court is of the opinion that undervaluation of a good in the invoice cannot be a ground for detention of the goods and vehicle. In view of the aforesaid the impugned order/order under section 129/the order of demand of tax is accordingly set-aside. The respondents are forthwith directed to release the goods belonging to the petitioner.
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