Payment of GST Penalty "Under Protest" for release of goods - Mandatory Requirement of Speaking Order under Section 129(3)

Last updated: 06 April 2026
Quick Summary
The Punjab and Haryana High Court has ruled that simply paying a GST penalty "under protest" does not automatically end proceedings. The Proper Officer must still issue a reasoned "speaking order" after considering the assessee's objections. This decision ensures that taxpayers are given a fair hearing and that decisions are not made prematurely, even when goods are released upon payment.

Court :
Punjab & Haryana High Court

Brief :
The Hon'ble Punjab and Haryana High Court in the case of M/s Deutsche Cars Pvt. Ltd. v. State of Haryana and Others [CWP-21628 of 2025, order dated January 31, 2026] held that mere payment of penalty under protest does not conclude proceedings under Section 129(5) of the GST Act, and the Proper Officer is mandatorily required to pass a reasoned order after considering the reply of the assessee.

Citation :
CWP-21628 of 2025, order dated January 31, 2026

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Bimal Jain
Published in GST
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