GST Update No 267 on no penalty for movement of vehicle in wrong direction

The unfolding of the concept of e-way bill and folding of Inspector Raj System in the GST regime has been prone to litigation wherein day in and day out, goods and vehicles are seized on the grounds of non-compliance of prescribed CGST Rules. Previously also there had been catena of cases wherein favourable decisions were imparted by the Court of Law. On similar lines, recently another case was reported before Karnataka High Court in the case of M/S TRANSWAYS INDIA TRANSPORT V/S JOINT COMMISSIONER OF COMMERCIAL TAXES. The decision delivered in this case is the subject matter of discussion of our present update.

The petitioner is a transporter and engaged in transportation of stainless-steel coils and plates from Mumbai to Bengaluru. The lorry was carrying 4 consignments out of which one was under transit. The driver of lorry mistakenly took wrong route i.e. instead of right, he took left. The vehicle was intercepted by authorised officers along with necessary documents. It was stated that the goods were moved without documents and thereby penalty was imposed for the same. The petitioner submitted that the driver mistakenly took wrong turn at 11:00 p.m. and before the error could be realised, the vehicle was seized and checked. It was argued that it is a human error committed without any intention to deceive. Further, the driver has furnished affidavit in this regard and communication was also received from the purchasers of the consignments.

The Counsel of respondent argued that looking at the present situation, it seems that the diversion of route was deliberated and not an error since driver covered such a long distance without being deliberated is an absurd situation.Further, it was submitted that affidavit of driver and communication by purchaser is an after thought and hence, should not be relied on.

The Court held that the driver was carrying E-way bills and tax invoices to deliver the goods. Further the diversion occurred at late night and hence, there are chances of human error. Hence, the impugned order was set aside by the Judiciary and petition was disposed off accordingly.

The above decision is yet another example in the catena of cases stating that goods cannot be seized on the sole grounds of routing the bus in the wrong direction. Reference may be made to the decision given by hon’ble Telangana High Court in the case of M/S COMMERCIAL STEEL COMPANY V/S ASSISTANT COMMISSIONER OF STATE TAX, and M/S SHREE RAMA STEELS V/S DEPUTY STATE TAX OFFICER upheld the same point of view. It is high time that the decisions rendered by the appellate authorities should be considered as binding precedent thereby avoiding any unwanted litigations in future.

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GST Update No 267 on no penalty for movement of vehicle in wrong direction

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