2026-VIL-208-GSTAT-AGR
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SGST Tribunal

GST - Penalty on Undeclared Goods Found in Transit - Applicability of Maruti Enterprises to goods claimed to be destined outside the State - Physical verification revealed a substantial quantity of makeup accessories and other goods for which no invoice, bilty or e-way bill was produced - Notice in Form MOV-07 was issued, and about a week later an advocate produced additional bilties and invoices claiming that the goods were moving from Delhi to Gwalior - The Mobile Squad Officer declined the documents because neither the buyers nor the sellers appeared, and no registration particulars or other evidence of identity or genuineness was furnished - Appellant contended that the second bundle of documents was inadvertently not produced at interception, and that the transit State officer had no jurisdiction in view of Maruti Enterprises v. State of U.P. - Whether the additional invoices and bilties produced long after interception established the genuineness of transportation, and whether the principle laid down in Maruti Enterprises applies to the facts of the case - HELD - The mere assertion that documents were available in a separate bundle does not establish that the goods found during physical verification were covered by those documents – Further, the absence of buyers and sellers by itself may not invariably be sufficient to reject a transaction. However, when it is considered together with non-production of documents at interception, delayed submission of additional documents, failure to establish identity and business credentials, discrepancies in multiple invoices of small individual values and absence of any person claiming ownership, the circumstances collectively cast serious doubt on the explanation offered - Appellant failed to establish a reliable documentary link between the additional documents and the goods found undeclared. Maruti Enterprises case, which holds that officers of a transit State are empowered only to intercept and verify goods and to intimate the origin or destination State, is distinguishable. In that case the relevant documents were available at the time of transportation, the buyers and sellers were registered dealers who acknowledged the transactions, and the destination outside the State was identifiable. In the present case, the goods were totally undeclared, and transportation of undeclared goods through a transit State may cause a tax effect in that State - Appellant cannot claim the benefit of an out-of-State destination without first establishing the factual basis of that claim bona fide - The second appeal is dismissed and the order of the FAA affirming the penalty is upheld
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