2024(04)LCX0478

Sangeeta Jain

Versus

Union of India

WRIT TAX No. - 783 of 2023 decided on 22-04-2024

Court No. - 1

Case :- WRIT TAX No. - 783 of 2023

Petitioner :- Ms. Sangeeta Jain
Respondent :- Union Of India And 3 Others
Counsel for Petitioner :- Gunjan Sharma,Namit Kumar Sharma
Counsel for Respondent :- A.S.G.I.,C.S.C.,Gopal Verma

Hon'ble Shekhar B. Saraf,J

1. Heard counsel appearing on behalf of the parties.

2. This is a writ petition under Article 226 of the Constitution of India, wherein the petitioner is aggrieved by the order dated December 12, 2022 passed by the respondent No.3/Additional Commissioner, Grade-2 (Appeal)-I, State Tax, Agra and the order dated March 13, 2021 passed by the respondent No.4/Assistant Commissioner, Mobile Squad-I, Agra.

3. Contention of the petitioner is that the only ground on the basis of which the penalty under Section 129(3) of the Central Goods and Service Tax Act, 2017 (hereinafter referred to as 'the Act') is that the dispatch address mentioned in the e-way bill. It is to be noted that the goods in the truck matched with the invoice and the e-way bill and there is no other discrepancy. Furthermore, the impugned orders do not, in any manner, indicate any intention to evade tax. In fact, the original authority has stated in his order that mens rea is not required for imposition of penalty.

4. Per contra, counsel on behalf of the respondents submits that the proceedings initiated against the petitioner is in accordance with the rules and provisions provided under the statutory provision. The impugned proceedings were initiated after due adjudication of the facts and materials on record. Hence, the same are just and proper.

5. A perusal of the order imposing penalty indicates that the original authority has stated that mens rea is not required for imposition of penalty. This view is not correct in law and the conclusion reached thereafter is obviously illegal. This Court in M/s Hindustan Herbal Cosmetics v. State of U.P. and Others (Writ Tax No.1400 of 2019 decided on January 2, 2024) held that mens rea to evade tax is essential for imposition of penalty. The relevant paragraph of the said judgment reads as under:

"8. Upon perusal of the judgments, the principle that emerges is that presence of mens rea for evasion of tax is a sine qua non for imposition of penalty. A typographical error in the e-way bill without any further material to substantiate the intention to evade tax should not and cannot lead to imposition of penalty. In the case of M/s. Varun Beverages Limited (supra) there was a typographical error in the e-way bill of 4 letters (HR ? 73). In the present case, instead of '5332', '3552' was incorrectly entered into the e-way bill which clearly appears to be a typographical error. In certain cases where lapses by the dealers are major, it may be deemed that there is an intention to evade tax but not so in every case. Typically when the error is a minor error of the nature found in this particular case, I am of the view that imposition of penalty under Section 129 of the Act is without jurisdiction and illegal in law."

6. In light of the above, I am of the view that the orders impugned in this writ petition cannot be sustained in the eyes of law. Accordingly, the orders dated December 12, 2022 and March 16, 2021 are quashed and set aside.

7. This Court directs the respondents to refund the amount of tax and penalty deposited by the petitioner within a period of four weeks from date.

8. The instant writ petition is allowed in the aforesaid terms

Order Date :- 22.4.2024

(Shekhar B. Saraf, J.)