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Applicability of Rule 138 of cGST Rules on unregistered person

Shanti Prime Publication Pvt. Ltd.

Section 129 of CGST Act, 2017—In the instant case, the GST officials intercept the vehicle and detain the goods of petitioner for no e-way bill accompanies the consignment.

The issue involved in this case is that— Should the transport at the behest of an individual, an unregistered person, suffer the same statutory limitations as does the transport by a registered person or transporter? Does the second proviso to subrule (3) of Rule 138 of the KSGST Rules save the transaction? And can we treat the car, sought to be transported without an E-way bill, as an item of "used personal and household effects"?

Held that— the second proviso to sub-rule (3) of Rule 138 stipulates that if an unregistered person transports the goods either by his own conveyance or by a hired one, or transports through a transporter, he or the transporter may generate the e-way bill in FORM GST EWB-01 on the common portal.
And sub-rule (14) of Rule 138 enlists the occasions when “no e-way bill is required to be generated.” The goods specified in Annexure stand exempted from the requirement of the e-way bill. And item 7 of the annexure covers used personal and household effects.

Now the question is, does the statutory mandate under section 129 of the GST Act admit of any discretion to let the affected party pay a reduced amount of tax and penalty pending further adjudication, for having the interim custody of the detained goods?

fail to persuade myself that I can take a different course from what has been judicially mandated in Indus Towers, for that case-holding squarely binds me. As a matter of abundant caution, I reiterate that I have not touched on the merits; nor should the authorities construe this judgment as expressing any view on the petitioners’ claims and contentions. The matter, as I have observed, concerns, interim custody of the goods. Section 129 and other provisions of the Act the Rules prescribe the procedure for that purpose. The petitioners can follow that procedure and secure the interim custody of the goods. Then, they can assail the Ext.P6 at the higher administrative echelons. This judgment will not prejudice them.

Harsh it may be to hold that the petitioners pay heavily, even interim, for minor lapses. But the law, at times, can be harsh, and the Courts, usually, defer to the legislative wisdom. So I do.

As a result, I only hold that either petitioner can get the goods released by complying with section 129 and the relevant rules, and seek an early adjudication of the dispute.[M/S. KUN MOTOR CO. PVT. LTD., VISHNU MOHAN VERSUS THE ASST. STATE TAX OFFICER, STATE OF KERALA] [2018] 4 TAXLOK.COM 073 (Ker)