2024(02)LCX0061

Anchor Health And Beauty Care Private Limited

Versus

State Of U.P.

WRIT TAX No. - 78 of 2022 decided on 06-02-2024

Neutral Citation No. - 2024:AHC-LKO:11024

Court No. - 6

Case :- WRIT TAX No. - 78 of 2022

Petitioner :- M/S Anchor Health And Beauty Care Pvt. Ltd.
Kanpur Thru. Authorised Person Mr.Sumit Agarwal
Respondent :- State Of U.P. Thru. Prin. Secy. (Tax And
Registration), Lko. And 2 Others
Counsel for Petitioner :- Abhijeet Kumar Srivastav
Counsel for Respondent :- C.S.C.

Hon'ble Alok Mathur,J.

1. Heard Shri Aditya Pande, learned counsel appearing for petitioner, learned Standing Counsel appearing for the State and perused the material available on record.

2. By means of the present petition, the petitioner has assailed the order dated 3.11.2020 passed by the Additional Commissioner Grade-2 (Appeal), Nyayik Sambhag (Legal Division)- Fourth, Commercial Tax, Lucknow thereby rejecting the appeal preferred by the petitioner and confirming the order of the adjudicating authorities dated 09.08.2018 thereby in exercise of power under Section 129 (3) of the U.P. GST Act imposing the penalty for an amount of Rs.20,241/- as well as tax of Rs. 20,241/-.

3. The brief facts of the case are that the petitioner is a registered dealer under the GST Act and is in business of manufacturing and sale of FMCG goods. It has Head Office in Bombay and for the State of U.P., the office is situated at 120/143 Lajpat Nagar, Kanpur and also has its branch office at Ghaziabad, Varanasi and Lucknow. It is stated that on 06.08.2018 the goods were being transported through Transexpress Logistics India Pvt. Ltd. from Patna Branch (Bihar) to Lucknow Branch (Uttar Pradesh) when they were intercepted and detention order was issued in the form of GST MOV 06 under Section 129 (1) of the U.P. GST, Act on the ground that there was a mismatch in the e-way bill and tax invoice. It was stated that the e-way bill was dated 02.08.2018 and the branch transfer invoice was dated 31.07.2018. Merely noticing that the said mismatch in the dates, the goods were detained and a show cause notice was issued to the petitioner under Section 20 of the IGST Act on the same day i.e., 06.08.2018. The petitioner appeared before the Assessment Commissioner, (Mobile Squad)-4, Lucknow and responded to the notice stating that the mistake was a mere human error and had occurred inadvertently by the person, who was generating the e-way bill on 02.08.2018 and that is why inadvertently the date of invoice was generated indicating the date as 02.08.2018 instead of 31.07.2018. It was further stated that the transaction was stock transfer from Patna Branch to Lucknow Branch and the said transaction was not liable to tax under the U.P. GST Act and consequently prayed for release of the goods.

4. The Adjudicating Officer rejected the contention raised by the petitioner and merely on the account that there was mismatch in the e-way bill and the branch transfer invoice imposed penalty and tax on the petitioner.

5. Learned counsel for the petitioner has submitted that the petitioner is a registered dealer and adhering to the provisions of GST in its letter and spirit. It is stated that in the normal course of business, the petitioner made a stock transfer from its Patna Branch to Lucknow Branch and the vehicle in which the goods were being transported was accompanying with all proper documents, such as, stock transfer of challan, e-way bill etc. and no discrepancy was found in any of the said document except the date indicated in the e-way bill and the branch transfer invoice.

6. He further submits that the goods in question, there is no liability to tax as the goods were being sent from the petitioner's one unit to another and further stated that there is no element of evasion of tax. He further submits that the goods were in transit, which was accompanying with documents and there was a mere technical breach and as soon as the same was informed to the authorities concerned, they should have considered the aforesaid facts in proper perspective and release the goods without any demands/penalty. It was further stated that the goods were being transported from one branch to another and there was no element of tax evasion involved in the present case and accordingly, the proceedings ought to have been dropped by the authorities.

7. Learned Standing Counsel, on the other hand, has supported the impugned order and submits that during the interception of the goods in question, a mismatch was discovered between the e-way bill as well as the branch transfer invoice. The dates in both the documents were at variance and consequently, submits that there were chances of misuse of the said documents leading to evasion of tax and accordingly prayed for dismissal of the writ petition.

8. I have heard learned counsel for parties and perused the record.

9. In the present case, there is no dispute with regard to the fact that the goods were being transported from Patna branch to Lucknow branch and the said goods were accompanying with all the relevant documents. The only discrepancy, which was noticed by the mobile squad, who intercepted the goods, was with regard to the date occurring in the e-way bill as well as branch transfer invoice. In the e-way bill the date occurring was 2.8.2018 while in the branch transfer invoice the date was 31.07.2018.

10. It has been submitted by the learned counsel for the petitioner that in the e-way bill the date indicated was 2.8.2018 because it was generated on the same day and the person who had generated the said bill failed to incorporate the said date as the bill was generated in the online form and he did not make the particular selection in the date. It is due to the said human error, the error has occurred, which is neither intentional nor is there any evasion of tax.

11. Learned Standing Counsel also could not dispute the fact that once the authorities had noticed that the goods were being transferred in pursuance to the stock transfer, there was no element of evasion of tax and hence, I do not find any reason for levying of penalty of tax for the said transaction.

12. This Court is of the considered view that even if there was discrepancy in the date which had occurred in the e-way bill as well as branch transfer invoice, there was no element of evasion of tax nor could any situation be pointed out to this Court where merely because of the said discrepancy, the petitioner could have evaded tax.

13. In light of the above, this Court is of the considered view that the impugned orders are arbitrary having levied tax on the petitioner on the goods meant for stock transfer between one branch to another and consequently, the said impugned order dated 3.11.2020 passed by the Additional Commissioner Grade2 (Appeal), Nyayik Sambhag (Legal Division)- Fourth Commercial Tax Lucknow as well as confirming the order of the adjudicating authorities dated 09.08.2018 are set aside and the writ petition is allowed.

(Alok Mathur, J.)

Order Date :- 6.2.2024