2026-VIL-504-CAL
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SGST High Court Cases

GST - Detention and Release of goods in transit - Demand under Section 129 of the CGST Act, 2017, disputing the ownership, quality, quantity, and authenticity of the accompanying tax invoices and e-way bills - Petitioner sought release of the perishable consignment under Section 129(1)(a) by paying the lesser penalty applicable where the owner comes forward - Revenue contended that since ownership was disputed, the higher penalty under Section 129(1)(b) applicable where the owner does not come forward ought to apply - Whether, when the revenue merely raises a dispute as to ownership in the SCN without producing any concrete contrary material to disprove the petitioner's claim of ownership, the consignment ought to be released under Section 129(1)(a) upon payment of penalty equal to two hundred percent of the tax payable, or whether the higher liability under Section 129(1)(b) is attracted – HELD - The provisions of Section 129 of the 2017 Act must be interpreted strictly. On a meaningful and harmonious reading thereof, the legislative intent is to release detained goods subject to fulfillment of conditions, without creating any charge or lien over the goods, since recovery of any crystallized demand is separately provided for under the statute - Where the petitioner is named as consignor and the consignee is named in the very show-cause notice and the revenue has not produced, identified, or discussed any concrete or unimpeachable material in its order raising demand to suggest that the petitioner is not the owner of the consignment, a mere assertion of dispute as to ownership in the SCN is insufficient to deny the petitioner the benefit of Section 129(1)(a) – The adjudication on ownership at this stage is of no relevance since the matter will be examined in a statutory appeal and if the demand is ultimately crystallized, the petitioner will be liable to pay regardless of ownership - The goods being perishable in nature, the consignment deserves to be released expeditiously. The petitioner is entitled to release of the consignment under Section 129(1)(a) upon payment of the applicable penalty. Subject to compliance of the provisions laid down under Section 129(1)(a) of the CGST Act, the consignment shall be released in favour of the petitioner in accordance with law. The writ petition is disposed of
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GSTAT Appeal filed wrongly...
By CA Vivek Jalan

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