Order Date – 21 February 2024

Parties: M/S Riadi Steels Llp Vs State Of U.P. And 4 Others

Facts –

• The Petitioner, M/S Riadi Steels Llp, transported goods with accompanying e-invoice and the e-way bill. During the course of movement, the engine of the vehicle in question got overheated and the e-way bill had expired four days prior to the date of detention.

Issue –

• Whether the detention of goods on expiry of e-way bill is proper?

Order –

• The Single Bench of Hon’ble High Court observed that the factual aspect in the present case clearly does not indicate any mens rea whatsoever for evasion of tax. The goods were accompanied by the relevant documents and the explanation of the petitioner with regard to slow movement of the goods coupled with GPS tracking system clearly indicate that the truck was moving slowly due to mechanical fault in the engine of the vehicle.
• This factual aspect should be considered by the authorities below. The breach committed by the petitioner with respect to not extending time period of the e-way bill is only a technical breach and it cannot be the sole ground for penalty order being passed under Section 129(3) of Act.
• Hence, the finding of the authorities with regard to intention to evade tax is not supported by the factual matrix of the case, and accordingly, the impugned orders dated April 6, 2022 and June 22, 2022 are quashed and set aside.