The Kerala Goods and services tax (GST) council has provided the guidelines for the detention of the goods while transportation on the basis of the undervaluation.
The guidelines are provided under the recent judgment of the Kerala High court in which the applicant’s goods were detained in the parcel godown by the Intelligence Squad on the basis of the value quoted in the invoice that comes with the goods was low when distinguished from the Maximum Retail Price (MRP) and that the HSN code of the goods was wrongly inserted.
During disposing of the mentioned case, the High court sees that there would be no provision beneath the Goods and services tax act that makes it essential that the goods will not be sold at a cost less than the MRP declared in it. Indeed there is nothing in the GST MOV-06 detention order to show that, on account of the wrong classification, there was any difference in the GST rate of tax that the taxpayer has taken.
Inside the provided circular it is specified that under the mentioned facts directed by the Hon’ble High Court of Kerala in WP(C). No. 30798 of 2019 (Y) dated. 18.11.2019 all the relevant are in this are said that they must not detain or provide any show-cause notice to the goods beneath transport or stored in the parcel agencies asking the only cause for the undervaluation of the goods compared to the Maximum Retail Price (MRP).
The circular given is that “If any undervaluation cases are suspected in such cases, the officers are directed to upload the details of such invoices using the option provided in the Mobile App and send a report to the jurisdictional Officer, marking a copy to the jurisdictional district Joint Commissioner. Further, the intelligence squads shall gather evidence to establish the case by collecting documents about the actual value of the supply. The jurisdictional officer concerned shall verify the same with the help of the report and the uploaded details. Thereafter, the jurisdictional officer of the taxpayer vertical or the Intelligence formation can take further action as provided in the law,”
