Sakeel @APPELLANT@Hash State Tax Officer, Office Of State Tax Officer

It is stated by learned counsel for the petitioner that show cause notice was issued to the petitioner in terms of Section 129 of the Rajasthan Goods

and Service Tax, 2017. However, while the petitioner submitted detailed representation pointing out that the goods and the bag containing the receipts

had been stolen, without taking into consideration the averments made in the representation, the respondents have proceeded to pass order under

Section 130 mentioning therein that the petitioner has neither appeared nor submitted any objection although the objections are already on record.

Taking note of the facts stated and the representation made by the petitioner, this Court finds that the order has been passed without application of

mind and in a mechanical fashion.

Having noted the aforesaid submission, this Court finds that Section 129 of the Central Goods and Service Tax, 2017 which is para-meteria to the

Rajasthan Goods and Service Tax provides as under:-

“129. Detention, seizure and release of goods and conveyances in transit

(1) Notwithstanding anything contained in this Act, whereany person transports any goods or stores any goods while they are in transit in

contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the

said goods and documents relating to such goods and conveyance shall be liable to detention or seizure and after detention or seizure, shall be

released,â€"â€

(a) on payment of the applicable tax and penalty equalto one hundred per cent. of the tax payable on such goods and, in case of exempted goods, on

payment of an amount equal to two per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods

comes forward for payment of such tax and penalty;

(b) on payment of the applicable tax and penaltyequal to the fifty per cent. of the value of the goods reduced by the tax amount paid thereon and, in

case of exempted goods, on payment of an amount equal to five per cent. of the value of goods or twenty-five thousand rupees, whichever is less,

where the owner of the goods does not come forward for payment of such tax and penalty;

(c) upon furnishing a security equivalent to theamount payable under clause (a) or clause (b) in such form and manner as may be prescribed:

Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the

goods.

(2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply for detention and seizure of goods and conveyances.

(3) The proper officer detaining or seizing goods orconveyances shall 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).

(4) No tax, interest or penalty shall be determined under subsection (3) without giving the person concerned an opportunity of being heard.

(5) On payment of amount referred in sub-section (1), allproceedings in respect of the notice specified in sub-section (3) shall be deemed to be

concluded.

(6) Where the person transporting any goods or the owner ofthe goods fails to pay the amount of tax and penalty as provided in sub-section (1) within

seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130.:

Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the

said period of seven days may be reduced by the proper officer.â€​

On reading the aforesaid provision, it is apparent that while the power exists with the respondents to take action under Section 129(3) of the Act

and thereafter to proceed under Section 130 of the Act, before taking any such decision, the concerned person has to be given an opportunity of being

heard which inherently means that the submissions which the concerned person may take up while filing his objections have to be examined and a

speaking order has to be passed giving out reasons for not accepting the objections. It is to be noted that once such an order has been passed, it can

be challenged by the aggrieved person by filing an appeal under Section 107 of the Act. 5. However, in the present case, this Court finds that the

requirement of Section 129 (4) & (5) of the Act has not been followed and the concerned authority has failed to take notice of the objections and it

cannot be said that the order impugned is a speaking order.

In the circumstances, without adverting to merits of the case, it would be appropriate for this Court to set aside the order passed under Section

129(3) of the Act as well as further proceedings taken under Section 130 of the Act and direct the respondents to give a fair opportunity of hearing to

the petitioner which may include a personal hearing too. The petitioner would be free to place on record all supporting documents in support of his

objections and averments.

The authority is expected to take a decision in the matter within fifteen days from the date of submission of certified copy. If the petitioner is further

aggrieved by the order, he would be free to file an appeal as provided under Section 107 of the Act and thereafter take any appropriate remedy as

available under the law.

After dictating the aforesaid part of the order, learned counsel for the petitioner submits that the goods which have been confiscated are perishable

and are lying with the respondents since May, 2015. The petitioner is ready to security/bank guarantee/security bond in lieu of the goods.

Learned counsel for the respondents submits that it would be very difficult to get the amount recovered if the security bond is allowed to be

accepted and the truck and goods can be released on submission of bank guarantee.

Taking into consideration the prayer made above, this Court finds that Rule 140 of the Central Goods and Service Tax Rules, 2017 provides as

under:-

“140. (1) The seized goods may be released on a provisional basis upon execution of a bond for the value of the goods in FORM GST INS-04 and

furnishing of a security in the form of a bank guarantee equivalent to the amount of applicable tax, interest and penalty payable.

Explanation.- For the purposes of the rules under the provisions of this Chapter, the “applicable tax†shall include central tax and State tax or

central tax and the Union territory tax, as the case may be and the cess, if any, payable under the Goods and Service Tax (Compensation to State )

Act, 2017 (15 of 2017).

(2) In case the person to whom the goods were released provisionally fails to produce the goods at the appointed date and place indicated by the

proper officer, the security shall be encashed and adjusted against the tax, interest and penalty and fine, if any, payable in respect of such goods.â€​

In view thereof, the respondents are directed to release the seized goods in terms of the said rules.

With the aforesaid observations/directions, the writ petition is disposed of.