GST--Detention of Goods

Dispute Involving Classification of Goods--Validity of Detention of Goods

CA. Satyadev Purohit

The learned author tries to make an analytical study of the issue as to whether goods can be detained and seized where the case involves bona fide dispute with regard to the classification between the consignor of the goods and the squad officer.

1. Introduction

Section 129 of the Central Goods and Services Tax Act, 2017 (in short "the CGST Act"), deals with the provisions relating to detention, seizure and release of goods and conveyance in transit. Sub-section (1) of section 129 provides that where any person transports any goods or stores any goods while they are in transit in contravention of the provisions of the Act or rules made thereunder, all such goods and the conveyance used as a means of transport for carrying the said goods and documents relating to such goods and conveyances shall be liable to detention or seizure. As per sub-section (3) of section 129, the proper officer detaining or seizing goods or conveyances is required to issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c) of sub-section (1) of section 129. In terms of sub-section (4) of section 129, no tax, interest or penalty shall be determined under sub-section (3) of section 129 without giving the person concerned an opportunity of being heard. Sub-section (6) of section 129 provides that where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within 14 days of such detention, further proceedings would be initiated in terms of section 130.