GST - State Tax officer has chosen to be harsh and vindictive - detention order suffers from vice of gross unreasonableness and disproportionality: HC
By TIOL News Service
CHENNAI, FEB 04, 2019: THE petitioner is an authorised dealer for Bajaj Auto Limited and dealing in two wheelers.
They had placed orders with their principal for delivery of 40 numbers of two wheelers [Pulsar Bike].
The goods were shipped from Pune to be delivered at Branch Office of the writ petitioner at Virudhunagar. The goods were moved from Pune on 23.12.2018. It appears that the vehicle transporting two wheelers instead of halting at Virudhunagar, had moved towards Sivakasi. When the vehicle was enroute to Sivakasi and 7 km away from Virudhunagar, it was intercepted by the respondent roving squad.
The respondent seized the vehicle and when they called upon the driver to cooperate, it appears, he did not extend proper cooperation.
Resultantly, impugned order of detention came to be passed. It was made clear that unless the penalty amount of Rs.18,96,000/- was paid, the goods as well as the vehicle would not be released; that the goods would be liable for confiscation and further proceedings under Section 130 of the Tamil Nadu GST Act, 2017 would be taken.
So, this Writ Petition.
The respondent department submitted that the vehicle ought to have halted at Virudhunagar and offloaded the consignment at the branch office. However, the vehicle moved towards Sivakasi. And, when the vehicle had travelled a distance of 7 km away from Virudhunagar, the respondent roving squad intercepted the vehicle.
The petitioner informed that the driver, who drove the vehicle in question is not a Tamilian; that his name is Badrinath Bhandari; that he hails from Maharashtra; that he knows neither English nor Tamil but only Marathi and Hindi; that the driver without knowing the correct route had taken a wrong turn and headed towards Sivakasi.
The High Court, at the outset, observed - … the question is whether a drastic order passed by the respondent herein was really warranted in the facts and circumstances of the case.
It was further observed -
+ It is not in dispute that the writ petitioner is an authorised dealer of Bajaj Auto Limited. It is also not in dispute that the goods are covered by appropriate documents. The tax payable has also been paid by the writ petitioner's principal. Thus, it is not a case of any evasion of tax.
+ It is also not in dispute that the bill is addressed only to the writ petitioner's principal office at Sivakasi; delivery alone is to be made at Virudhunagar. I am of the view that even if by mistake, a wrong instruction had been given to the driver of the vehicle to head towards Sivakasi. Still it would not really matter. The only question that the respondent ought to have posed is whether there is any attempt at evasion. It is not as if the goods had already been offloaded. The vehicle was intercepted when it was in transit.
+ The respondent ought to have directed the driver of the vehicle to move back towards Virudhunagar. Instead of adopting such a procedure, the respondent had chosen to be harsh and vindictive. When the writ petitioner is a registered dealer, when the tax in respect of the goods have already been remitted and when the transportation of goods is duly covered by proper documentation, the respondent ought to have taken a sympathetic and indulgent view of the lapse committed by the driver of the vehicle. The detention order dated 28.12.2018 and the order dated 11.01.2019 suffer from vice of gross unreasonableness and disproportionality. When a power is conferred on a statutory authority, it should be exercised in a reasonable manner.
The High Court also observed that the goods in question are two wheelers which could not be sold without proper registration with the Motor Vehicle Authorities and, therefore, in a case of this nature, the writ petitioner could not have evaded his statutory obligations in any manner, which aspect ought to have been taken note by the respondent.
The Petitioner was directed to pay a sum of Rs.5000/- towards fine, the orders impugned in the Writ Petition were quashed and the respondent was directed to forthwith release the vehicle as well as goods in question.
The Writ Petition was allowed.
(See 2019-TIOL-431-HC-MAD-GST)
