2026-VIL-252-GSTAT-BLR
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  2. 2026-VIL-252-GSTAT-BLR

SGST Tribunal

GST - Detention of goods in transit under Section 129 of CGST Act, 2017 - Effect of applying pre-amended Section 129(1)(a) requiring tax and penalty instead of the amended penalty only - Order held not void ab initio - Goods were intercepted in January 2024, and the proper officer demanded tax and penalty at equal amounts under the provision as it stood before 01.01.2022, whereas the amended provision requires payment of penalty equal to two hundred percent of the tax - Appellant contended that the order was void ab initio since the pre-amended provision was not in existence on the date of interception, relying on decisions on retrospective operation of substituted provisions - Whether the entire proceedings are void ab initio because the pre-amended provision was applied - HELD – The Section 129 addresses violations by a person transporting or storing goods in transit, and the amendment only changed the quantum of amount payable for release of goods and conveyance, without taking away the power of the proper officer to detain goods and examine whether the Act or rules are violated. The substantive portion of the Section was not changed. The officer committed a mistake in demanding tax and penalty under the pre-amended law, but the application of the old law does not invalidate the order - The order cannot be set aside as void ab initio on the ground that the pre-amended law was applied - Invocation of Section 129 of CGST Act, 2017 on consignment sent for job work with e-way bill and delivery challan - Section 143 and Rule 55 of CGST Rules, 2017 - Appellant sent PP woven fabric, wastage and scrap to its principal in another State, and the proper officer detained the consignment on the ground that the goods were not capital goods and IGST was not charged on inter-State transportation - Whether invocation of Section 129 is just and proper on the facts - HELD - The e-way bill recorded the movement as outward job work and the consignment was accompanied by a delivery challan, which required the proper officer to examine the transaction in the light of the provisions governing job work. The mere absence of IGST on the delivery challan could not establish a contravention without identifying the applicable charging provision and the nature of the alleged taxable supply - Section 143 permits a registered person to send inputs or capital goods to a job worker without payment of tax and to receive the finished goods within the prescribed period, so the reasoning that IGST was not charged is incorrect, and the Section applies to both inputs and capital goods - The FAA did not examine Section 143 read with Rule 55 and repeated the reasoning of the proper officer verbatim. Both documents contained the information required under Rules 55 and 138 of the CGST Rules, and no provision of the Act or rules was violated - Imposition of tax and penalty under Section 129 set aside, the appeal allowed - Maintainability of additional grounds raised for the first time before the Appellate Tribunal - Appellant raised additional grounds before the Tribunal - Whether the additional grounds are maintainable before the Tribunal - HELD - A question of law arising from facts already on record can be allowed to be raised where it is necessary to consider it for correctly determining the liability. The additional ground raised is a pure question of law - The additional grounds are held maintainable before the Tribunal
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