The Judgment of the Honourable Rajasthan High Court became a precedent that under the GST regime, the scope of inquiry ends if goods in transit conform with the documents.
The Petitioners H.R. Enterprises submitted to the Honourable High Court on April 10 of this year that its goods and vehicle have been detained since March 11, 2021, even though physical verification and inspection of the goods, along with its weighment, has already been concluded and ended. Consequently, if goods and vehicles are detained further, it would result in the loss of business and hope which would be irreversible. Hence no inquiry is required.
The single-judge bench of Justice Dinesh Mehta commented that under the new GST regime, all the stakeholders are facing uncertainties. The reason being, the path is comparatively unmarked, unfamiliar, and unpaved. And The criteria of the “dealers’ duties or responsibilities or liabilities and authorities’ powers” are yet to be demarcated.
The Honourable High Court further observed that the notice served in MOV-07 is an instance of aforesaid uncertainty. The Penalty should have been as per Section 129(1)(a) which is Rs.1,93,460/-. However, the proposed penalty is as per Section 129(1)(b) which is Rs.10,74,780/-. The Honourable High Court held that the statutory remedies will be inefficacious.
Furthermore, The Honourable High Court issued notices to the respondents in which jurisdiction of check post/Anti-evasion/ Squad officer was challenged as per section 68 of the aforesaid Act.
The Honourable High Court issued the directive that the respondents ought to release the goods and vehicle which have been detained if petitioner furnishes 2 solvent sureties to the amount of Rs.15 lakhs that is executed by dealers who have been registered in the State of Rajasthan. The respondent shall not demand a furnishing bank guarantee or cash security.
Advocates N.K Taparia and Sharad Kothari appeared on behalf of petitioners in the aforesaid case.
