Facts of the Case

HBS Alloys Pvt. Ltd., through its Director Shri Harsh D. Shah, filed this writ application under Article 226 challenging detention notices dated 20.12.2021 in FORM GST MOV-6 and FORM GST MOV-10, and seeking release of truck No. GJ-20-T-5665 along with the goods carried in it. During the pendency of the petition, the department passed a final order of confiscation dated 04.03.2022 in FORM GST MOV-11 under Section 130 of the GST Act, which the petitioner sought to challenge by way of a draft amendment that the Court allowed. The matter was heard on the footing that the confiscation order had, by then, already been passed at the departmental level.

Issues Involved

  1. Whether the writ Court should adjudicate a challenge to a final confiscation order under Section 130 once such an order has already been passed.
  2. Whether the petitioner should instead be relegated to the statutory appellate remedy under Section 107 of the SGST Act.

Petitioner's Arguments

  • The detention notices in FORM GST MOV-6 and MOV-10 dated 20.12.2021 were arbitrary and liable to be quashed, and the truck along with goods ought to be released.
  • The subsequent confiscation order dated 04.03.2022 in FORM GST MOV-11 was also under challenge, and its operation ought to be stayed pending disposal of the petition.

Respondent's Arguments

  • The extracted order does not record substantive submissions advanced by the State; the Bench proceeded on the undisputed fact that the final confiscation order had already been passed.

Court Order/Findings

  • The Court noted that the final order of confiscation in FORM GST MOV-11 had already been passed, and accordingly expected the petitioner to challenge it by way of a statutory appeal under Section 107 of the SGST Act rather than continue with the writ.
  • The Appellate Authority was directed to take up any such appeal expeditiously and dispose of it on its own merits.
  • The petitioner was given liberty to seek interim relief before the Appellate Authority for provisional release of the goods, or to prevent auction of the goods/conveyance pending appeal, with such applications to be heard and decided forthwith.
  • Since the petitioner had been bona fide pursuing the writ remedy before the High Court, delay, if any, in filing the appeal was to be condoned.
  • The writ application was disposed of on this footing.

Important Clarification

  • Once a final order of confiscation under Section 130 has been passed, a writ court will ordinarily relegate the aggrieved party to the statutory appeal under Section 107 rather than adjudicate the challenge itself.
  • Time spent bona fide pursuing a writ remedy against detention/confiscation proceedings is a valid ground for condonation of delay in filing the subsequent statutory appeal.

Sections Involved

  • Section 129, Central/Gujarat Goods and Services Tax Act, 2017 — detention and seizure of goods/conveyance in transit (Forms MOV-6, MOV-10).
  • Section 130, Central/Gujarat Goods and Services Tax Act, 2017 — confiscation of goods/conveyance (Form MOV-11).
  • Section 107, Gujarat Goods and Services Tax Act, 2017 — statutory appeal against orders passed under the Act.
  • Article 226, Constitution of India — writ jurisdiction invoked by the petitioner.

Decision – In Favour of

The writ application was disposed of without any adjudication on the merits of the detention or confiscation. The petitioner was relegated to the statutory appellate remedy under Section 107, with the Appellate Authority directed to hear the appeal expeditiously, interim relief applications to be decided forthwith, and delay in filing the appeal to be condoned. This is best described as disposed of with directions, procedurally accommodating the Assessee's position without deciding the substantive dispute in favour of either side.

Related Case Laws

No related case laws are available on this site at present.

Case Details

  • Court: High Court of Gujarat at Ahmedabad
  • Case No.: R/Special Civil Application No.800 of 2022
  • Coram: Hon'ble Mr. Justice J.B. Pardiwala and Hon'ble Ms. Justice Nisha M. Thakore
  • Date of Order: 20 April 2022

Link to Download the Order

Download the full judgment (PDF)

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