Allahabad High Court: GST Authority Can’t Alter Stand After Verifying Goods and Invoices During Transit

The Allahabad High Court noted that while conducting verification, the authority cited the details of the goods found and verified the accuracy of the invoices and goods in transit. It ruled that the authority cannot later change its position and claim that the goods did not match the invoice.

Justice Piyush Agrawal Ruled That

“Once on the verification report i.e. MOV-04, the items are fed by the officer concerned, after due verification, the authorities cannot be permitted to completely change its stand or further permitted to supplement by different reasons or grounds, which were not taken or mentioned while preparing the physical verification report in MOV-04.”

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It was pleaded by the applicant that the goods were intercepted at the time of transportation from Guwahati, Assam, to Delhi. In the interception, all documents were produced, and the driver’s statement was recorded.

No distinction was discovered between the invoice and the actual goods, and the goods details were noted in MOV-4, as argued during physical verification.

A penalty order was issued against the applicant even after no discrepancies were found. The appeal was dismissed, which the applicant filed. Applicant, after discovering that the authority cannot be allowed to revise its stand in future, has approached the HC.

No distinction was made between the goods and their description cited in the invoices and the MOV-04, and therefore, the status of the revenue remained the same.

Department’s counsel pleaded that once the HSN code under the invoice is entered in MOV-04, the cited goods in the invoice shall automatically emerge in MOV-04, on the particular query of the court, he acceded that the goods need to be entered manually via authority.

“The purpose of filling MOV-04, at the time of physical verification, is to find the correctness of the goods in transit from the accompanying documents and if the officer while preparing the MOV-04 did not find any change or difference in goods that of mentioned in the accompanying documents, the same cannot be permitted at a later stage for taking a different stand, as mentioned in the present case,” Justice Agrawal cited.

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In Jitendra Kumar Vs. State of U.P. and Another, the court laid down its ruling where it was ruled that the revenue could not be allowed to revise the objective after each phase, i.e revenue should stick to its taken stand.

The writ petition is been allowed by the court.