Gujarat High Court
M/S. Krishna Enterprise vs Union Of India on 16 April, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 4071 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
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Approved for Reporting Yes No
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M/S. KRISHNA ENTERPRISE
Versus
UNION OF INDIA & ORS.
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Appearance:
MR ABHISHEKKUMAR C MALVI(9941) for the Petitioner(s) No. 1
MR MAULIK VAKHARIYA(6628) for the Petitioner(s) No. 1
MS SHRUNJAL SHAH, AGP for the Respondent(s) No. 2,3,4
MR ANKIT SHAH(6371) for the Respondent(s) No. 1,5
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR.JUSTICE D.N.RAY
Date : 16/04/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned advocate Mr. Maulik Vakhariya for the petitioner and learned Assistant Government Pleader Ms. Shrunjal Shah for the respondent.
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NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined
2. By this petition under Articles 226 and 227 of the Constitution of India, the petitioner has challenged the show-cause Notice dated 11.11.2024 in FORM GST MOV-10 and order dated 20.11.2024 passed in FORM GST MOV-11.
3. Brief facts of the case are that the petitioner purchased 25005 Kgs of Remelted Lead Ignots from M/s. Sunrise Enterprises by Invoice No. 162 dated 23.10.2024. The said goods were being transported by road from Bavla, Gujarat to Hyderabad, Telangana which is the business place of the petitioner alongwith E-way Bill. The respondent No.2 intercepted Truck No. KA- 56-1947 on 24.10.2024 at 5:40 A.M. wherein, the aforesaid goods were being transported by the petitioner under Page 2 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined section 129 of the Central/State Goods and Service Tax Act,2017 [for short 'the GST Act']. Respondent No.4 passed an order for physical verification of goods in FORM GST MOV-2 on 24.10.2024. Thereafter, after physical verification of the goods in question, order of detention under section 129(1) in FORM GST MOV-06 dated 26.10.2024 was passed.
3.1 Respondent No.4 issued the show- cause notice in FORM GST MOV-10 under section 130 of the GST Act proposing to confiscate the goods as well as the conveyance on the grounds stated therein after conducting inquiries when it was found that the supplier of the goods M/s. Sunrise Enterprise, Surat was a non- existent entity and that fake/bogus Page 3 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined invoices were generated and signed by someone. It is the case of the petitioner that the show-cause notice in FORM GST MOV-10 was issued on 11.11.2024 and opportunity of physical hearing was given to the petitioner to appear before the respondent No.4 on 19.11.2024. 3.2 The authorized representative of the petitioner appeared for hearing before the respondent-authority and provided a written reply to the show-cause notice along with an application for release of the goods and conveyance as per section 129(1)(a) of the GST Act wherein, the petitioner consented to pay an amount of Rs. 15,75,315/- being 200% penalty under protest.
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NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined 3.3 Respondent No.4 passed the order under section 130 of the GST Act and not in FORM GST MOV-11 on 20.11.2024. 3.4 It is the case of the petitioner that after receiving the order in FORM GST MOV-11, the petitioner requested the respondent to upload the same in the portal so that the petitioner can file appeal challenging the same. The petitioner made requests through Emails dated 23.01.2025 and 03.02.2025. 3.5 Thereafter, the petitioner received communication dated 25.01.2025 on 13.02.2025 issued by the respondent No.4 intimating the petitioner that the subject goods would be auctioned.
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NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined 3.6 It is the case of the petitioner that as the statutory period of three months for the appeal would have ordinarily lapsed on 20.02.2025 and in view of the auction notice issued by respondent No.4, so as to file appeal in time, the petitioner requested his jurisdictional officer by way of Email on 18.02.2025 to upload the order in the portal.
3.7 Considering the request of the petitioner the Jurisdictional Officer uploaded the order on portal on 18.02.2025. The petitioner therefore, filed an appeal online on 18.02.2025 and also submitted a copy of the appeal in physical form as per the prescribed procedure within the statutory time period Page 6 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined before respondent No.5-the Commissioner of Customs and Central Tax (Appeals)-1, Commissionorate Hyderabad. 3.8 The petitioner also made a request to respondent No.4 on 18.02.2025 to release the vehicle and the goods as the appeal against the order in FORM GST MOV- 11 was already filed as per the provision of section 107(7) of the GST Act and as all demands of the balance amount are stayed and also prayed for withdrawal of the auction notice.
3.9 The petitioner thereafter, on 11.03.2025 addressed an Email to respondent No.5-the appellate authority requesting for provisional release of the Page 7 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined goods and for withdrawing the auction notice.
As neither the goods are released nor auction notice was withdrawn by respondents and therefore, being aggrieved the petitioner has preferred this petition.
4. Learned advocate Mr. Vakhariya for the petitioner submitted that the petitioner had no option but to prefer an appeal and in absence of uploading of the order by the respondent No.4 on the portal, the petitioner requested the jurisdictional officer at Hyderabad to upload the order and thereafter, has preferred an appeal before respondent No.5-the appellate authority, as per the option availabed on the portal to chose the appellate Page 8 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined authority. It was submitted that respondent No. 4 has failed to consider the applications made by the petitioner various times for provisional release of the goods and the conveyance though the petitioner was ready and willing to pay the amount of the penalty as per the order passed in FORM GST MOV 11 amounting to Rs. 15,75,315/- under protest subject to the outcome of the appeal filed by the petitioner. It was further submitted that respondent-authority was bound to consider the request of the petitioner for provisional release of the goods and withdraw the auction notice and therefore, the petitioner had approached this Court for quashing and setting aside the show- cause notice issued in FORM GST MOV 10 and the order in GST FORM MOV-11 before this Page 9 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined Court with interim prayer to release the goods and conveyance in question provisionally on the condition of payment of 200% penalty by the petitioner.
5. Per contra, learned AGP Ms. Shrunjal Shah submitted that the petitioner has already preferred the appeal before the appellate authority respondent No.4 who has become functus officio. It was also pointed out that as the respondent No.4, who has passed the impugned orders under the provisions of the Gujarat Goods and Service Tax Act,2017 and as per the provision of section 107 read with Rule 109A of the Central/State Goods of Service Tax Rules, 2017 ['GST Rules' for short] has become the functus officio, the petitioner was required to prefer an Page 10 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined appeal challenging the impugned order passed in FORM GST MOV-11 before the Commissioner (Appeals) at Gujarat. It was submitted that the petitioner has already availed an alternative remedy by preferring the appeal before the Commissioner (Appeal), Hyderabad and the petitioner has made an application for provisional release of the goods before the appellate authority and no further order is required to be passed by the Court in the facts of the case.
6. It was also pointed by learned AGP Ms. Shah after referring to the impugned show- cause notice in FORM GST MOV-10 as well as the impugned order in FORM GST MOV-11 to the effect that the supplier of the goods to the petitioner is a non-existent entity Page 11 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined and details are already provided in the show-cause notice as well as the impugned order passed by the respondent No.4 which is a subject-matter of appeal preferred by the petitioner.
7. Considering the submissions made by the learned advocates for the respective parties and having perused the documents placed on record, it appears that the petitioner has already preferred appeal before respondent No.5 which is pending for adjudication. The petitioner has therefore, availed the remedy as per the provisions of the GST Act and therefore, the petitioner could not have preferred this petition under Article 226 of the Constitution of India praying for the same relief for quashing and setting aside the Page 12 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined show-cause notice in FORM GST MOV 10 as well as the order in FORM GST MOV 11 which is a subject-matter of adjudication before the appellate authority. i.e. respondent No.5.
8. With regard to prayer of the petitioner for provisional release of the goods and conveyance in question, the petitioner has already made an application before the appellate authority for release of such goods and conveyance in question and therefore, no further adjudication is required on the said issue on provisional release at this stage.
9. On perusal of the impugned show-cause notice passed in GST MOV-10 and order passed in FORM GST MOV-11 prima facie, it Page 13 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined appears that the supplier of the petitioner-M/s. Sunrise Enterprise is a non-existent entity. However, neither the supplier of the goods to the petitioner nor the transporter, who is owner of the truck in question have made an attempt for release of the goods or conveyance.
10. On perusal of the impugned order passed in FORM GST MOV-11, it appears that the petitioner has purchased the goods from some other person and obtained the bill in name of M/s. Sunrise Enterprise who is a non-existent entity. On perusal of the details provided in FORM GST MOV-11, it also appears that the said M/s. Sunrise Enterprise was found to be a non-existent on physical verification carried out by respondent No.4 at Surat and therefore, Page 14 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025 NEUTRAL CITATION C/SCA/4071/2025 JUDGMENT DATED: 16/04/2025 undefined the goods purchased by the petitioners are liable to be confiscated under the provision of section 130 of the GST Act.
11. In view of the foregoing reasons, no interference is made in the impugned order to challenge the impugned show-cause notice dated 11.11.2024 in FORM GST MOV-10 as well as order in FORM GST MOV-11 passed by respondent No.4. We further make it clear that the observations made by us in this order are prima facie subject to the adjudication to be done by the appellate authority in accordance with law. The petition therefore being devoid of any merits is accordingly dismissed.
(BHARGAV D. KARIA, J) (D.N.RAY,J) JYOTI V. JANI Page 15 of 15 Uploaded by JYOTI V. JANI(HC00213) on Wed Apr 23 2025 Downloaded on : Wed Apr 23 21:16:39 IST 2025