Case Title | Neva Plantation Private Limited vs ACST&E |
Court | Himachal Pradesh High Court |
Honorable Judges | NA |
Citation | 2020 (02) GSTPanacea 30 HC Himachal Pradesh EXN-005/2019-GST-2992-97 |
Judgement Date | 12-February-2020 |
Council for Petitioner | N.K.Thamon |
Council for Respondent | Kishor Kumar |
Section | 107.129(1),122 |
In Favour of | In Favour of Assessee |
The Himachal Pradesh Bench has held that every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees in relation to a supply; or for reasons other than supply; or due to inward supply from an unregistered person, is required to generate e way bill before the commencement of such movement.
FACTS OF THE CASE
This appeal has been filed against the order dated 27-11-2018 passed by the Asst. Commissioner State Taxes & Excise (ACST&E)-cum-Proper Officer vide which an additional demand of 1,18,800/- was created against the appellant under sub-section (1) Section129 of GST Act 2017.
The appellant is a private limited company and is engaged in the plantation business. The plants falling under Chapter 6 of the Customs Tariff are exempt from GST. Any person engaged exclusively in the business of supplying goods that are wholly exempt from tax, is not required to be registered. However the appellant was not aware of the above legal provision and had taken GST Registration No. 02AABCN9078P1ZXand filling GST returns by showing exempted supplies.
The appellant had sent one machine named “Auto Clave” for repair to its supplier M/s. Pragati Laboratory Equipment, Ambala Cantt (Haryana) in Vehicle No. HP 37F3056 and had issued Delivery Challan No. 84 dated 29-10-2018. In this delivery challan, it was specifically mentioned that “not for Sale” and “Only for Repair.”
The said machine was intercepted on 30-10-2018 at 6:20AM at Ranital. The statement of driver of the truck was recorded in GST MOV-01 having Reference No. NEZ-03/30-10-18. Further, the order for physical verification/inspection was passed in GST MOV-02 having Reference No. NEZ-03/30-10-18 on the reasoning that “E-way bill was not tendered for auto slave machine being transported in inter-state movement for repairs of value worth 3,89,400/-”.
The above machine along with conveyance was detained due to non-availability of E-way bill and detention order in GST MOV-06 having Reference NO.NEZ-03/30-10-18 was served. Further, notice under Section 129 (3) of CGST/HPGST Act, 2017 was issued in GST MOV-07 having Reference No. NEZ-03/30-10-18 giving options under Section 129 (1) ibid of payment of IGST of 59,400/- [18% on 3,30,000/-] with equal penalty of ? 59,400/- and to file reply to the notice.
In both the documents GST MOV-06 and GST MOV-07, the reason is mentioned that “E-way Bill not generated for Interstate movement of AutoClave Machine being transported for repair”. The self-certified copies of GST MOV-6 and GST MOV-7 are enclosed in this regard
The appellant furnished a bond in GST MOV-08 along with FDR No. 38044098038 for the amount equivalent to tax and penalty proposed. The machine along with conveyance was released on furnishing of above bond and FDR and release order in GST MOV-05 having Reference No. NEZ-03/30-10-2018dated 01-11-2018. The self-certified copy of FDR and GST MOV-5 is enclosed in this regard.
The appellant filed detailed objections vide their letter dated 21-11-2018 to notice issued in GST MOV-07. In this letter, they submitted that since the appellant is engaged in the supply of exempted goods, they are not required to issue e-way bill as per Rule 138 (14) (E) of CGST Rules, 2017. They had not issued e-way bill for sending above machine for repair under this bonafide belief that they are not required to issue e-way bill being engaged in supply of exempted goods.
They further submitted that activity to send goods for job work/repair does not attract GST as not covered under the definition of “supply” and as per the provision of Section 129 (1) of CGST Act, 2017, not tax and penalty is attracted in this case.
They further submitted that as per Section 129 (6)and 130 (1) of CGST Act, 2017, no detention is sustainable in this case as there is no intent to evade GST. The non-issuance if e-way bill in such a situation is only a procedural lapse without any revenue implication or loss to the department. In view of these submissions, they requested to vacate GST MOV-07.
COURT HELD
Considering the facts as recorded, held that every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees in relation to a supply; or for reasons other than supply; or due to inward supply from an unregistered person, is required to generate e way bill before the commencement of such movement.
Since the transaction has no tax implications, the proper office while adjudicating the case has taken into consideration the invoice value of the nine month old purchase invoice for determining the tax and penalty in this case under section 129(1) of the Act. The method used for valuation of transaction is not just and proper as the disputed goods were old and were dispatched for repair.
In the view of the above facts, the instant appeal is accepted and the order passed by Assistant Commissioner State Taxes & Excise-cum-Proper Officer, North Enforcement Zone Palampur dated 27.11.2018 is set aside. The tax and penalty deposited by the appellant under section 129(1) may be refunded and a penalty of Rs Ten Thousand only ( 10,000/-) is imposed on the taxpayer under section 122 (1) of the Act. The judgment in this case was reserved on 04.01.2020 which is released today.
ANALYSIS OF THE JUDGEMENT
Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees in relation to a supply; or for reasons other than supply; or due to inward supply from an unregistered person, is required to generate e way bill before the commencement of such movement.
As there is no doubt that the taxpayer has violated the provisions of the CGST/HPGST Act, 2017, so is liable to pay penalty. The tax payer has transported goods without the cover of proper documents (e way bill is one of them). In this regard, attention is invited toward section 122 of the CGST/HPGST Act that can come into play in the instant case which provides
Where a taxable person who-supplies any good9ir services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply;
Transports any taxable goods without the cover of documents as may be specified in this behalf;
He shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evaded or the tax not deducted under section 51 or short deducted or deducted but not paid to the Government or tax not collected under section 52 or short collected or collected but not paid to the Government or input tax credit availed of or passed on or distributed irregularly, or the refund claimed fraudulently, whichever is higher.
Download PDF:
For Reference Visit:
Read Another Case Law: