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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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
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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
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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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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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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
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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
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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
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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
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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
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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
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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
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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
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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,
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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
