The Allahabad High Court clarified that once the consignor comes forward with the case that due to human error of the labourer, fewer goods were loaded at night, then the evasion of tax cannot be attributed to the transporter.

The Court also held that once the goods have been released to the consignor and in the absence of any adverse material being brought on record against the transporter, the vehicle in question cannot be seized, and no proceeding can be initiated against the transporter.

A Single Judge Bench of Justice Piyush Agrawal observed that the authority had released the goods in favour of the consigner after finding that the said goods belong to the consignor, without recording any adverse finding against the petitioner, who is a transporter.

As no finding has been recorded that the transporter, i.e., the petitioner, is engaged in the business of purchase and sale of any goods, the Bench quashed the proceedings against the petitioner and directed the Department to refund any amount deposited by the petitioner pursuant to the impugned orders.

Briefly, while the goods of the petitioner, a transporter, were in transit from Dehradun to Delhi, they were intercepted at Meerut, and the physical verification unearthed some shortfall of goods. Resultantly, proceedings were initiated against the owner as well as the vehicle carrying the goods, which were later seized.

Though it was explained that due to a human error of the labourer, fewer goods were loaded at night, the same was not accepted, and an order under section 129(3) of the GST Act was passed. Thereafter, seized goods were released on payment of the amount equal to the market price. However, the proceedings were not dropped.

Appearances:

Advocates A.K. Mishra and Niraj Kumar Singh, for the Petitioner/ Taxpayer

CSC, for the Respondent/ Revenue