Higher penalty cannot be imposed u/s 129(1)(b) of the CGST Act if owner of goods comes forward to pay penalty

Last updated: 16 August 2023

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The Allahabad High Court has ruled that if the owner of detained goods comes forward and is willing to pay the penalty, the Revenue Department cannot impose a higher penalty under section 129(1)(b) of the CGST Act. In this case, the petitioner, Bhawani Traders, proved ownership with valid documents, and the court found the Revenue's conclusion otherwise to be erroneous. The penalty order under 129(1)(b) was set aside, and a fresh order under 129(1)(a) was directed.

Court :
Allahabad High Court

Brief :
The Hon'ble Allahabad High Court in Bhawani Traders Pvt. Ltd. v. State of Uttar Pradesh [Writ Tax No. 854 of 2023 dated July 24, 2023] held that if the assessee comes forward and is willing to pay the penalty for the detained goods, the Revenue Department cannot issue penalty order under section 129(1)(b) of the Central Goods and Services Tax Act, 2017 ("the CGST Act").

Citation :
Writ Tax No. 854 of 2023 dated July 24, 2023

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Judgement posted by

Bimal Jain

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FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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