Higher penalty cannot be levied where owner of goods come forward in case of detention

Last updated: 05 August 2023

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The Allahabad High Court has ruled that a higher penalty under Section 129(1)(b) of the UPGST Act cannot be levied if the owner of the goods comes forward to pay the penalty. In this case, the owner of the goods, M/s. Margo Brush India, presented themselves after their goods were seized. The court found that only a penalty equivalent to 200% of the tax payable, as per Section 129(1)(a), could be imposed. The original penalty order was set aside.

Court :
Allahabad High Court

Brief :
The Hon'ble Allahabad High Court in M/s.Margo Brush India & Ors. v. State of U.P[ Writ Tax No. 1580 of 2022 dated January 16, 2023] set aside the penalty order passed under Section 129(1)(b) of the Uttar Pradesh Goods and Services Tax Act, 2017 ("the UPGST Act") by the adjudicating authority and held that penalty under Section 129(1)(b) of the UPGST Act was unjustified and untenable since the owner has come forward for payment of penalty.

Citation :
Writ Tax No. 1580 of 2022 dated January 16, 2023

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1 Year PLAN

1999

(Excl. of GST ₹359)

2 Years PLAN

3499

(Excl. of GST ₹629)

BEST VALUE

3 Years PLAN

4999

(Excl. of GST ₹899)

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Judgement posted by

Bimal Jain

Service

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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