Facts of the Case

The petitioner, M/S Ritvik Steel Private Limited, through its Director Mr. Amit Kumar, had its goods detained and an order passed against it on 16.09.2021 in exercise of power under Section 129 of the GST Act (detention/seizure of goods and conveyances in transit). The petitioner's appeal against that order was dismissed by the appellate authority by order dated 17.11.2022 on the ground of lack of territorial jurisdiction — the appellate authority recorded that since the seizing officer who passed the order was located at Lucknow, the appeal ought to have been filed before the appellate authority at Lucknow rather than the authority where it was actually filed, having regard to the petitioner's registration at Bahraich. The petitioner challenged this dismissal order dated 17.11.2022 before the Allahabad High Court, Lucknow Bench.

Issues Involved

  1. Whether an appellate authority, on forming the view that it lacked territorial jurisdiction over a Section 129 appeal, could simply dismiss the appeal instead of returning or transmitting it to the authority having jurisdiction.
  2. Whether the dismissal order dated 17.11.2022 was sustainable in light of the petitioner's online filing of the appeal and the circulars governing jurisdiction of appellate authorities.

Petitioner's Arguments

  • The petitioner relied on circulars issued from time to time governing which appellate authority has jurisdiction over Section 129 appeals.
  • It was argued that the appeal was filed online, and that if the appellate authority formed the view that it lacked jurisdiction, it should have either returned the appeal for filing before the proper authority or transmitted/relegated it to the authority having jurisdiction, rather than dismissing it outright.
  • The petitioner contended that outright dismissal on a purely territorial-jurisdiction ground, without an opportunity to pursue the appeal before the correct authority, was legally impermissible and caused avoidable prejudice.

Respondent's Arguments

  • The Standing Counsel for the State, on instructions, fairly conceded that the order dated 17.11.2022 was erroneous.
  • It was submitted on behalf of the State that the appellate authority ought to have transmitted the appeal for adjudication before the proper officer who had territorial jurisdiction to decide it, instead of dismissing the appeal.

Court Order/Findings

  • Acting on the Standing Counsel's statement made on instructions, the Court accepted that the dismissal was erroneous for failing to transmit the appeal to the jurisdictionally competent authority.
  • The Court quashed the order dated 17.11.2022 and directed that the petitioner's appeal be transmitted to the proper officer having territorial jurisdiction, who shall decide the appeal within two months.
  • The writ petition was disposed of with these directions and observations, without the Court itself adjudicating the merits of the underlying Section 129 detention order.

Important Clarification

  • An appellate authority under the GST Act that concludes it lacks territorial jurisdiction over an appeal cannot simply dismiss it; the appeal must be transmitted or returned so that it can be decided by the authority with proper jurisdiction.
  • Procedural or territorial defects of this kind are curable and should not defeat an assessee's substantive right of appeal against a Section 129 detention/seizure order.
  • Where such an error is conceded by the department itself, courts will readily quash the dismissal and fix a time-bound schedule (here, two months) for the appeal to be decided afresh by the correct authority.

Sections Involved

  • Section 129, CGST/UPGST Act, 2017 — governs detention, seizure and release of goods and conveyances in transit found in contravention of the Act.
  • Appellate provisions, CGST/UPGST Act, 2017 — govern the filing and territorial jurisdiction of first appeals against orders passed under the Act, including Section 129 orders.

Decision – In Favour of

Disposed of with directions, in favour of the Assessee to the extent that the erroneous dismissal was quashed and the appeal was directed to be heard on merits by the proper officer; the substantive question of the Section 129 detention remains to be decided afresh.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: Allahabad High Court, Lucknow Bench
  • Case No.: WRIT TAX No. 125 of 2023
  • CNR: Not available on record
  • Coram: Hon'ble Mr. Justice Pankaj Bhatia
  • Decision Date: 09 October 2023
  • Disposal Nature: Disposed of — order quashed, appeal to be transmitted to the proper jurisdictional officer

Link to Download the Order

Download the full judgment (PDF)

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.