The Allahabad High Court ruled that if a registered manufacturer had goods detained during transit, solely for non-filling of Part B of the e-way bill due to an undisputed technical glitch, and no finding of intent to evade tax existed, then imposition of penalty under section 129(3) of the GST Act is not sustainable in law.
A Single Judge Bench of Justice Piyush Agarwal observed from the record that only due to a technical glitch, Part B of the e-way bill could not be filled, but there was no intention to evade payment of tax. However, none of the I-T authorities had recorded any finding with regard to the intention of tax evasion.
Therefore, referring to the Division Bench of this Court in M/s Tata Hitachi Construction Machinery Company Pvt Ltd vs. State of U.P. [Writ Tax No. 2148/2025], where it was categorically held that non-filling of e-way bill will not attract penalty under section 129(3), the Bench allowed the petition and directed the authority concerned to refund any amount deposited by the petitioner in pursuance of the present proceedings.
Briefly, the dispute arose upon interception, when the plastic moulds supplied by the petitioner-manufacturer were seized during movement, solely because of the non-filling of Part B of the e-way bill. This culminated in the imposition of a penalty under section 129(3) of the GST Act, which was affirmed on appeal.
Case Relied On:
M/s Tata Hitachi Construction Machinery Company Pvt Ltd vs. State of U.P. [Writ Tax No. 2148/2025]
Appearances:
Advocates Lokesh Mittal and Vishwjit, for the Petitioner/ Taxpayer
CSC, for the Respondent/ Revenue
