2026-VIL-234-GSTAT-LCK
  1. Home
  2. 2026-VIL-234-GSTAT-LCK

SGST Tribunal

GST - Penalty under Section 129(3) of CGST Act, 2017 for diversion of goods to an undeclared recipient - Vehicle carrying goods accompanied by tax invoice, e-way bill and bilty was intercepted near the entrance of a factory in Kanpur, whereas the documents declared the bill-to party in Haryana and ship-to party in Kolkata - Department alleged diversion on the basis of the location of the vehicle, the driver's initial statement and a discrepancy in the bilty regarding the place of dispatch - Penalty was imposed in Form GST MOV-09 and upheld by FAA - Whether the Department has established, on the basis of cogent and reliable evidence, that the goods were intended to be delivered to an undeclared recipient so as to justify penalty under Section 129(3) - HELD - The goods were accompanied by a tax invoice and e-way bill identifying the goods and the declared transaction, and no discrepancy in description or quantity was established. Mere presence of a vehicle near a factory entrance does not conclusively establish that the goods were being delivered there. The driver's statement is relevant but cannot be treated as conclusive in isolation and must be assessed with the accompanying documents and independent corroboration - In the absence of evidence showing actual unloading, receipt of the goods by the alleged local recipient, or other independent material establishing the alleged transaction, the inference of diversion must be examined with caution. The declared invoice and e-way bill cannot be displaced merely on the basis of suspicion or an inference drawn from the vehicle's location - Where the authority relies on a video recording, the person proceeded against must have a reasonable opportunity to examine and controvert it, and the non-supply of the recording impaired the ability to rebut – Further, under the GST Act there is no provision requiring disclosure of route. The Department did not establish actual unloading or receipt by an undeclared purchaser, and since the vehicle was intercepted outside the gate, the allegation rests on assumption rather than proof - The Order-in-Appeal and the Order-in-Original are set aside - The penalty under Section 129(3) is quashed and the appeal is allowed
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Dr. G. Gokul Kishore

Weekly Summary

VIL Video

GST & Customs updates: Sep'26
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Security-Code
New Code?

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Security-Code
New Code?

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?