Case Details Vardan Associates Pvt. Ltd. vs Assistant Commissioner of State Tax Central Section & Ors.

Court

Supreme Court of India

Date

31 October 2023

Case No.

Civil Appeal No. 8302 of 2023

Result

Disposed

Bench

Hima Kohli, Ahsanuddin Amanullah

Citation

[2023] 16 S.C.R. 1118 : 2023 INSC 1087

Issue for consideration

Consignment was intercepted in the course of inter-state movement, as there was no valid E-way bill. High Court directed that the goods be released subject to payment of the entire amount of the Goods and Service Tax in cash and 50% of the penalty imposed also in cash while the remaining 50% by way of bank guarantee.

Headnote

Central Goods and Services Act, 2017 – West Bengal Goods and Services Act, 2017 – Integrated Goods and Services Tax Act, 2017 – Appellant executed work contracts for GAIL in the State of UP in Auraiya district, including work in the State of West Bengal – It availed services of one M/s. HFC for mobilising a machine-the consignment (capital goods under CGST Act) used for execution of works contracts from Auraiya, UP to Durgapur, West Bengal, for which an E-way Bill was generated – However, as transportation was not done within the validity period of the E-way bill, the consignment was intercepted and order of detention was issued, at the time of entering the State of West Bengal – Consignment and the vehicle detained – Order of demand of tax and penalty passed – Eventually, High Court inter alia, directed that the goods be released subject to payment of the entire amount of the Goods and Service Tax in cash and 50% of the penalty also in cash while the remaining 50% by way of bank guarantee – Challenged – Present consideration confined only to the quantum of penalty: Held: Appellant was saddled with tax – Law also provides for imposition of penalty – Ordinarily, this Court would have refrained from interfering, but because there was an E-way bill that was generated and in view of the factual scenario which is not disputed that the appellant is the owner of the consignment and was using it in connection with its contractual obligations in Uttar Pradesh and then having a similar contract in West Bengal and no evidence had been placed on record showing that the consignment was to be sold/used for any other purpose in respect of any other party, the orders passed by the High Court varied – ₹ 54,00,000/- being the tax imposed is upheld however, penalty is reduced to 50% of the penalty imposed and would now be ₹ 27,00,000/- – ₹81,00,000/- be paid by the appellant (subject to payment already made) – Upon the same being done, the transportation vehicle as also the consignment be released – Present order passed u/Article 142 and shall not be a precedent. [Paras 18, 17, 19 and 20] OTHER CASE DETAILS INCLUDING IMPUGNED

ORDER AND APPEARANCES

JUDGMENT / ORDER OF THE SUPREME COURT ORDER Leave granted. 2. We have heard learned counsel for the parties. 3. The present appeal emanates from the final judgment and order passed by the learned Single Judge of the High Court at Calcutta (hereinafter referred to as the “High Court”) in Writ Petition bearing W.P.A. No.17452 of 2019 dated 2nd August, 2022 (hereinafter referred to as the “Impugned Judgment”), by which the said petition was dismissed. BRIEF FACTS: 4. The appellant, being a company, carries on the business of horizontal directional drilling using trenchless methodology for un

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