Non-filling of Part ‘B’ of the E-Way Bill on technical difficulties and without any intention to evade tax would not lead to the imposition of penalty. – All HC

Facts:

Precision Tools India (“the Petitioner”) dully filled part A of the e-way bill and due to some technical difficulties, part B of the e-way bill could not be generated. The goods in question were personal-made goods with exclusive specifications that were supplied to the Railways and such goods could only be supplied to the particular consignee. The Proper Officer without finding any defect in the consignment note nor any discrepancy in the documents, passed an order of penalty dated April 22, 2021 (“the Impugned Order”) under Section 129(3) of the Uttar Pradesh Goods and Services Tax Act, 2017 (“the UPGST Act”).
Thereafter, the Petitioner filed an appeal before the Appellate Authority (“the Respondent”) and an order dated November 20, 2021 (“the Impugned Order”) was passed under Section 107 of the UPGST Act.
Issue:
Whether penalty can be levied if Part B of the E-way bill is not filed due to technical difficulties?
Held:

The Hon’ble Allahabad High Court in PRECISION TOOLS INDIA VERSUS STATE OF U.P. AND 3 OTHERS – 2024 (2) TMI 183 – ALLAHABAD HIGH COURT held as under:

• Observed that, the Respondent has been unable to indicate any intention of the Petitioner to evade tax.
• Relied on, M/S ROLI ENTERPRISES VERSUS STATE OF U.P. AND 2 OTHERS – 2024 (1) TMI 813 – ALLAHABAD HIGH COURT wherein the Court had considered two judgments of the Allahabad High Court in VSL ALLOYS (INDIA) PVT. LTD. VERSUS STATE OF U.P. AND ANOTHER – 2018 (5) TMI 455 – ALLAHABAD HIGH COURT and M/S CITYKART RETAIL PVT. LTD. THRU. AUTHORIZD REPRESENTATIVE VERSUS THE COMMISSIONER COMMERCIAL TAX U.P. GOMTI NAGAR LKO. AND ANR. – 2022 (9) TMI 374 – ALLAHABAD HIGH COURT and held that non-filling up of Part ‘B’ of the e-Way Bill by itself without any intention to evade tax would not lead to the imposition of penalty under Section 129(3) of the UPGST Act.
• Held that, the defect was technical only and without any intention to evade tax. Accordingly, the penalty imposed under Section 129(3) of the UPGST Act is unsustainable. The Impugned Orders were quashed and set aside. The writ petition was allowed.