Proceedings under Section 130 of the CGST Act cannot be put to service if excess stock is found at the time of survey

Last updated: 03 December 2024

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The Allahabad High Court has ruled that proceedings under Section 130 of the CGST Act cannot be initiated solely based on the discovery of excess stock during a survey. The court clarified that Section 130, which deals with confiscation and penalties, requires proof of intent to evade tax. If excess stock is found, tax determination and penalties should typically be pursued under Sections 73 or 74 of the CGST Act.

Court :
Allahabad High Court

Brief :
The Hon'ble Allahabad High Court in the case Vijay Trading Company v. Additional Commissioner[Writ Tax No. 1278 of 2024 dated August 20, 2024]set aside order passed under Section 130 under Central Goods and Services Tax Act, 2017 ("the CGST Act") following the determination of excess stock in inspection and directed the determination of tax on Section 73/74 of the CGST Act. As intent to evade tax must be present for the application of Section 130 of CGST Act.

Citation :
Writ Tax No. 1278 of 2024 dated August 20, 2024

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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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Attached File : 671907_5800_vijay_trading_company.pdf

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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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