Goods were transported on payment of tax; but, however, assessee intended to re-sell the goods from his dealership, In such circumstances, suspicion of evasion could not be brushed aside. Therefore, order of learned Single Judge was set aside and directed release of the goods on execution of a simple bond for the value of goods in the prescribed form and furnishing of security in the form of Bank Guarantee equivalent to the amount of applicable tax and penalty payable.

Seizure, Detention and Confiscation — Assessee was transporting goods from Ernakulam, after powder coating, to their business premises at Wayanad — Goods were accompanied with the purchase invoice of the goods and also for powder coating — In absence of E-way bill, Goods were detained by the Revenue — On appeal, learned Single Judge directed release of the goods on execution of a simple bond for the amounts covered by the detention orders — Hence, Revenue was in appeal challenging the interim order passed by the learned Single Judge—Held, it was found that goods were transported on payment of tax; but, however, assessee intended to re-sell the goods from his dealership, In such circumstances, suspicion of evasion could not be brushed aside — Therefore, order of learned Single Judge was set aside and directed release of the goods on execution of a simple bond for the value of goods in the prescribed form and furnishing of security in the form of Bank Guarantee equivalent to the amount of applicable tax and penalty payable — Appeal Allowed.

1. State is in appeal challenging the interim order passed by the learned Single Judge.

2. The respondents/writ petitioners, dealers under the Central Goods and Service Tax Act, 2017 [for brevity “CGST Act”], were transporting goods from Ernakulam, after powder coating, to their business premises at Wayanad. The goods were accompanied with the purchase invoice of the goods and also for powder coating, which is a 'service' under the CGST Act. However, there was a specification with respect to uploading of E-way bills as per Rule 138 of the Central Goods and Service Tax Rules. Only on uploading of E-way bill, would the Department be notified of purchase and movement, is the contention. Without that, there could be an evasion suspected. The learned Single Judge found that the case of the writ petitioners is covered by the decision in W.P.(C) No.196 of 2018.

3. We had partly heard the appeal from the aforesaid writ petition today. We notice that there is clear distinction on facts insofar as, therein the transaction was alleged to be not taxable for reason of the transport being made to the work site of one of the applicants and the other after job works, to the business premises of the dealer. Therein, there was a delivery challan under Rule 55 of the Kerala Goods and Services Tax Rules. The learned Single Judge had found that since the genuineness of the said challan was not suspected, there could be no tax evasion. In the present case, the goods were transported on payment of tax; but, however, the dealer intends to re-sell the goods from his dealership. In such circumstances, suspicion of evasion cannot be brushed aside at this stage.

4. The learned Single Judge directed payment of Rs.10,000/- [Rupees ten thousand] each by the writ petitioners and furnishing of simple bonds for the amounts covered by the detention orders. We do not think that the same can be sustained after looking at the provisions. However, we do not say anything on this, since the writ petition is pending and it may not be proper for this Court to pre-empt the learned Single Judge from elaborate consideration of the matter. We, therefore, set aside the interim order and direct release of the goods on execution of a simple bond for the value of goods in the prescribed form and furnishing of security in the form of Bank Guarantee equivalent to the amount of applicable tax and penalty payable as has been demanded in Exhibits P17 and P18 orders.

The Writ Appeal is disposed of, leaving the questions to be considered in the writ petition itself.

Sd/-

K.Vinod Chandran

Judge

Sd/-

Ashok Menon

Judge

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Kerala High Court

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Goods were transported on payment of tax; but, however, assessee intended to re-sell the goods from his dealership, In such circumstances, suspicion of evasion could not be brushed aside. Therefore, order of learned Single Judge was set aside and directed release of the goods on execution of a simple bond for the value of goods in the prescribed form and furnishing of security in the form of Bank Guarantee equivalent to the amount of applicable tax and penalty payable.

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Seizure, Detention and Confiscation — Assessee was transporting goods from Ernakulam, after powder coating, to their business premises at Wayanad — Goods were accompanied with the purchase invoice of the goods and also for powder coating — In absence of E-way bill, Goods
were detained by the Revenue — On appeal, learned Single Judge directed release of the goods on execution of a simple bond for the amounts covered by the detention orders — Hence, Revenue was in appeal challenging the interim order passed by the learned Single Judge—Held,
it was found that goods were transported on payment of tax; but, however, assessee intended to re-sell the goods from his dealership, In such circumstances, suspicion of evasion could not be brushed aside — Therefore, order of learned Single Judge was set aside and directed release of the goods on execution of a simple bond for the value of goods in the prescribed form and furnishing of security in the form of Bank Guarantee equivalent to the amount of applicable tax and penalty payable — Appeal Allowed.

1. State is in appeal challenging the interim order passed
by the learned Single Judge.
 2. The respondents/writ petitioners, dealers under the
Central Goods and Service Tax Act, 2017 [for brevity “CGST Act”],
were transporting goods from Ernakulam, after powder coating, to
their business premises at Wayanad. The goods were
accompanied with the purchase invoice of the goods and also for
powder coating, which is a 'service' under the CGST Act. However,
there was a specification with respect to uploading of E-way bills
as per Rule 138 of the Central Goods and Service Tax Rules. Only
on uploading of E-way bill, would the Department be notified of
purchase and movement, is the contention. Without that, there
could be an evasion suspected. The learned Single Judge found
that the case of the writ petitioners is covered by the decision in
W.P.(C) No.196 of 2018.
 3. We had partly heard the appeal from the aforesaid
writ petition today. We notice that there is clear distinction on facts
insofar as, therein the transaction was alleged to be not taxable for
reason of the transport being made to the work site of one of the
applicants and the other after job works, to the business premises
of the dealer. Therein, there was a delivery challan under Rule 55
of the Kerala Goods and Services Tax Rules. The learned Single
Judge had found that since the genuineness of the said challan
was not suspected, there could be no tax evasion. In the present
case, the goods were transported on payment of tax; but, however,
the dealer intends to re-sell the goods from his dealership. In such
circumstances, suspicion of evasion cannot be brushed aside at
this stage.
 4. The learned Single Judge directed payment of
Rs.10,000/- [Rupees ten thousand] each by the writ petitioners and
furnishing of simple bonds for the amounts covered by the
detention orders. We do not think that the same can be sustained
after looking at the provisions. However, we do not say anything on
this, since the writ petition is pending and it may not be proper for
this Court to pre-empt the learned Single Judge from elaborate
consideration of the matter. We, therefore, set aside the interim
order and direct release of the goods on execution of a simple
bond for the value of goods in the prescribed form and furnishing
of security in the form of Bank Guarantee equivalent to the amount
of applicable tax and penalty payable as has been demanded in
Exhibits P17 and P18 orders.
 The Writ Appeal is disposed of, leaving the questions to

be considered in the writ petition itself.
 Sd/-
K.Vinod Chandran
Judge
 Sd/-
Ashok Menon Judge

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