Page 60 - GSTL_30th April 2020_Vol 35_Part 5

546 GST LAW TIMES [ Vol. 35
aforementioned goods were wrongly classified, in fact they would be falling un-
der the Head. 2202 10, for which the GST rate is 28%. Against the aforementioned
detention, the petitioner vide reply to Ext.P3(d) notice submitted that, the allega-
tion of misclassification is without merit, and petitioner has already applied for
an advanced ruling pertaining to same matter in Gujarat and the said matter is
pending in the Hon’ble High Court of Gujarat is with an interim stay favouring
petitioner. It is in this back ground, the action of the authorities in detaining
goods has been assailed in the present writ petition. Counsel for the petitioner in
view of the aforementioned facts, challenged the action by raising following
submissions :
(a) The GST authorities in Kerala do not have jurisdiction to issue show
cause notice of the tax on import as only the officers in the Karna-
taka could initiate the proceedings. At the best the authorities at
Kerala have a remedy of sending an intimation to the authorities of
Karnataka.
(b) It is not a case of evasion but a bona fide dispute concerning the exi-
gibility of tax i.e. the rate of tax. A bare reading of Section 129(1) of
the GST Act states that in contravention of any of the provisions of
the Act or the rules made thereunder, the goods liable to be de-
tained can be released on payment of tax and penalty but that situa-
tion would arise only when the goods in movement without any
valid documents, but the instant case is covered under the valid tax
invoice Ext.Pl, on which the applicable IGST was duly charged and
E-way Bill, Ext.P2 was correctly generated by the petitioner. The au-
thorities in Kerala have powers to verify documents like invoice and
E-way bills. In fact, there was no discrepancy in respect of the quan-
tity or description of the goods mentioned in the tax invoice. The
only reason for detention was that the respective drinks were not
correctly classified and liable to [xxx] tax as 28% and not under
22029920 attracting 12% of GST.
(c) In support of the aforementioned contention the Learned Counsel
for the petitioner has relied upon the decision of this Court in N.V.K
Mohammed Sulthan Rawtger and Sons v. Union of India & Ors., [2018-
VIL-502-KER = 2019 (20) G.S.T.L. 708 (Ker.)] and also the Division
Bench judgment of the Hon’ble Gujarat High Court in Synergy Fer-
tichem Pvt. Ltd. v. State of Gujarat [2019-VIL-623-GUJ = 2020 (33)
G.S.T.L. 513 (Guj.)].
3. Per contra, the Learned Government Pleader opposed the aforemen-
tioned prayer of the petitioner by relying upon Section 129 of the CGST Act,
starting with a non obstante clause that the officers are empowered in case any
person transporting any goods while they are in transit in contravention of the
provisions of the Act or the rules made thereunder, such goods and conveyance
shall be liable to detention or seizure. They shall be released on the conditions
enumerated in clauses (a) to (c) of Section 129 and as per the provisions of sub-
section (6) of Section 129 in case the amount of tax and penalty imposed upon
any goods or the owner of the goods is not deposited within 14 days of such de-
tention and seizure, the proceedings of confiscation and levy of penalty as pro-
vided under Section 130 of 2017 of the GST Act would follow. It was further
submitted that there is contravention in provision relating to transportation, with
wrong description of goods and misclassification of tax; hence it is possible for
proper officer to detain the vehicle along with goods transported.
4. Learned Counsel for the petitioner in rebuttal submitted that any
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