Madhya Pradesh High Court has taken an important decision to hold that minor error of address in the e-way bill cannot be considered as tax evasion. Further, Chief Justice Muhammad Rafiq and Justice Vijay Kumar Shukla (Division Bench) directed Commercial Tax Department who had levied tax and penalty amounting to INR 22 lakh because of wrong address on the e-way bill, to follow the circular dated September 18, 2018. According to the circular, the penalty should be one thousand rupees.
A company of Katni, had ordered goods from its parent company in America and the goods were being transported from Mumbai to Katni. The goods got custom clearance at Mumbai, Bandargh and tax was paid. However, in the e-way bill, the delivery address was mentioned as Mumbai instead of Katni but the distance of 1200 KM was correctly mentioned.
The officers of the department imposed tax and penalty amounting to INR 22 lakh and did not accept the mistake of wrong address as a clerical error. Thereafter, the appeal was filed before Joint Commissioner but the same was dismissed. Subsequently, petition was filed before Madhya Pradesh High Court.
Petitioner’s advocate, Abhishek Dhyani stated that the penalties are being imposed under Section 129 of Central Goods and Services Tax Act, 2017 on the basis of minor technical error. This is the first decision made by Madhya Pradesh High Court regarding e-way bill and the decision will help the businessmen to get relief from imposition of heavy taxes and penalties due to minor lapses.