This appeal has been filed under Section 107 of the Goods and Service Tax Act, 2017 by M/s Aadhaar Wholesale Trading & Distribution Limited, Plot No:2, Jagdish Marg, Bani Park, Jaipur-302016 (Raj) (hereinafter also referred to as ‘the appellant’) against Order-in-Original No. EWB-04 dated 21.02.2019 (hereinafter referred to as “the impugned order”) passed by Joint Commissioner, Central Goods & Service Tax Division-F, Sector-10, Vidhyadhar Nagar, Jaipur (hereinafter also referred to as “the adjudicating authority”).

Brief facts of the case:-

2.1 The brief facts of the case are that the appellant is having GSTIN No.08AAFCA8793G1Z9 engaged in whole sale business of home needs, groceries, foods and beverage, etc., The principal place of business of the Company is in the state of Rajasthan, situated at Plot No.2, Jagdish Marg, Bani Park, Jaipur. The Dealer has recently opened a new Branch at Faujadar Complex 2, Kachhari Road Ward No.20, Bayana, Bharatpur (Rajasthan). To set up the infrastructure at that branch, dealer has transferred certain fixed assets namely old computer system, tube lights, fans etc., from its Bagru branch to Bayana branch on 21.02.2019 though vehicle No. RJ 34 4A 02000.

2.2 On 18.02.2019 at 07.00 PM at Bagru, the Joint Commissioner, Central Goods & Service Tax Division-F, Sector-10, Vidhyadhar Nagar, Jaipur had intercepted in movement the appellant’s conveyance bearing Regn. No. R3 34 4A 0200. The statement of the Driver/person in-charge was also recorded on 18.02.2019. The goods in movement were inspected on 21.02.2020 under the provisions of sub section (3) of Section 68 of the Central Goods and Service Tax Act, 2017 and the following discrepancies were found:-

(a) E-way bill not produced.

2.3 In view of the above, the impugned goods and the conveyance used for the movement of goods were without any valid documents accordingly the same were detained under sub-section (1) of Section 129 of Central Goods and Service Tax Act’ Act 2017 read with sub-section (3) of Section 68 of the State/Union Territory Goods and Service Tax Act, 2017 or under Section 20 of the Integrated Goods and Service Tax Act read with sub- section (3) of Section 68 of the Central Goods and Service Tax Act, 2017 by issuing an order of detention in FORM GST MOV 06 and the same was served on the person in charge of the conveyance on 21.02.2019.

2.4 Accordingly, the adjudicating authority has passed the impugned order. The adjudicating authority apart from confirming the demand of Tax amounting to ₹ 1,01,377/-(₹ 6723/-CGST+ ₹ 6723/- SGST + ₹ 87,931/-IGST) imposed a penalty equal to 100% Tax. The impugned goods were released by issuing Release Order in the FORM GST MOV 05 dated 21.02.2019 after depositing of duty and penalty amount.

3. Being aggrieved with the impugned order, the appellant has filed the appeal on various grounds which are summarized as under:

-that the assessing officer has erred by treating the transfer of Fixed Assets as stock transfer and imposing the tax and penalty on account of non-availability of E-way Bill. The transfer was merely the shifting of fixed assets from one branch to another for which there is no requirement of E-way Bill.

-that under the Act, it is mentioned that no E-way Bill is required to be generated for the transfer of Fixed Assets.

– that under the facts and circumstances of the case the adjudicating authority has treated the movement as supply under GST. Whereas, in the aforesaid case of dealer, it is merely the shifting of old used fixed assets from one branch to another branch having same GSTIN within a state and there is no implication of tax on said movement as per Section 7 of the CGST Act, 2017.

“7 (1) For the purposes of this Act, the expression ‘supply’ includes –

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

(b) import of services for a consideration whether or not in the course or furtherance of business; [and]

(c) the activities specified in Schedule I, made or agreed to be made without a consideration; and

(d), the activities to be treated as supply of goods or supply of services as referred to in Schedule II”.

Further, it is worthwhile to mention that a person can not sell goods to himself, and in the above case, it can be verified from the attached copy of goods transfer challan that consignor and consignee are the same person having same GSTIN but with different office address. This itself proves that it was not a sale, it is mere transfer which does not attract any GST liability. Further, the documents seized by the adjudicating authority was available with the transporter at the time of detention was ‘Delivery Challan’, not a GST invoice to sell goods with or without GST. Here, in our case, as it was not a sale, so, the dealer has not raised any GST invoice. We are enclosing herewith copy of GSTR-1 for the month of Feb-2019 from which it can be verified that all the sale made was against GST invoice series from 218003881 to RJ0920178114. Whereas our delivery challan has a series No.2120 which is different from the above series.

that the adjudicating authority has applied Section 129 (1) and imposed a penalty equal to the amount of 100% of tax payable on such goods. But in dealer’s case, the movement of the goods is not a supply as per ground-1. So it is not subject to tax and then, the applicability of penalty is not possible.

that the adjudicating authority has imposed penalty on transfer of used capital goods from one branch to other branch on the mere ground of non-availability of E-way Bill. Whereas, the adjudicating authority has totally ignored the delivery challan and bilty available with the vehicle. The dealer is in the impression that in case of transfer of used capital goods from one branch to other branch within same state does not attract any sort of issuance of E-way Bill. Further, when the adjudicating authority is under the control of vehicle and has the power to physically verify and check the goods and ascertain that whether the same are for the purpose of sale or otherwise. We are enclosing herewith details of said goods which were used in our own Bayana branch. So from the above, it is very much clear that the intention of the dealer is not malafide and he acts in bonafide manner. So, the penalty imposed on the dealer is unlawful.

4. Personal Hearing in the case was conducted on 12.02.2020. Shri N.K. Sarda, Chartered Accountant appeared on behalf of the appellant and explained the case in detail and reiterated the submission as already made in their appeal memorandum and also submitted additional written submission dated 12.02.2020 and requested to decide the case at the earliest.

5. I have carefully gone through’ the case records and detail submissions made by the appellant in the appeal memorandum as well as at the time of personal hearing.

6. On perusal of the facts on record, I find that the adjudicating authority has imposed a Tax ₹ 1,01,377/-(₹ 6723/-CGST+ ₹ 6723/- SGST + ₹ 87,931/-IGST) and imposed a penalty equal to 100% Tax under Section 129 (3) of the CGST Act, 2017 on the ground that on 18.02.2019 at the time of inspection of the movement of goods the driver/person-in-charge of the goods were carrying the goods without E-way Bill. The appellant in their defence has stated that he is engaged in whole sale business of home needs, groceries, foods and beverage, etc., The Principe place of business of the Company is in the state of Rajasthan, situated at Plot No.2, Jagdish Marg, Bani Park, Jaipur. The Dealer has recently opened a new Branch at Faujadar Complex 2, Kachhari Road Ward No.20, Bayana, Bharatpur (Rajasthan). To set up the infrastructure at that branch, dealer has transferred certain fixed assets namely old computer system, tube lights, fans etc., from its Bagru branch to Bayana branch on 21.02.2019 though vehicle No.RJ 34 4A 02000.

In the above context, it is observed that Section 7 of the CGST Act, 2017 defines the Scope of Supply, Section 7 (1) provides that ‘Supply’ includes activities such as sale, transfer, barter, exchange etc. made for a consideration in the course or furtherance of business. This implies that the activity undertaken shall be an action which takes place in the course of regular conduct of business, such as sale or it should have the effect of furtherance of the business. Therefore, the activity to be called as supply should be such that undertaking that activity shall amount to conduct of business or enhancing ‘the business. The transfer of a going concern, either as a whole or an independent part thereof, for a lump sum consideration does not constitute an activity taking place in the course of business or furtherance of business. However, since the word ‘includes’ has been used in Section 7 (1) the scope of supply goes beyond the meaning of the expression ‘in the course or furtherance of business’. Therefore in the case of the transfer of a going concern even if the act of transfer does not constitute an activity carried out in the course of regular business or for furtherance of business, the activity may still qualify to be termed as a supply.

If transfer of going concern is considered as a part of business then it is a supply. To determine this, Section 7 (1A) provides that where certain activities or transactions constitute a supply in accordance with the provisions of sub section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule-II.

In schedule II, the entry at Serial Number 4 refer to ‘transfer of business assets’. Transfer of business assets is considered as supply of goods.

Whereas, as per Section 68 of the CGST Act, read with Rule 138A of the Central Goods and Service Tax Rules, 2017 requires that the person-in-charge of a conveyance carrying any consignment of goods of value exceeding ₹ 50,000/- should carry a copy of documents viz., Invoice/Bill of Supply/Delivery Challan/Bill of Entry and a valid E-way Bill in physical or electronic form for verification. In case such person does not carry the mentioned documents, there is no doubt that a contravention of the provisions of the law takes place and the provisions of Section 129 and Section 130 of the CGST Act are invocable.

From the above legal provisions, [t is therefore, becomes clear that such transfer of fixed assets namely old computer system, tube lights, fan etc from its Bagru branch to Bayana Branch through vehicle no. RJ 34 GA 0200 is considered as a supply of goods rather the Stock Transfer. Hence GST is applicable and E way Bill is mandatorily required as per above provisions. On being seen the document i.e. Delivery Challan, the appellant was carrying along with the vehicle/goods on which the taxable value as well as applicable tax was very much shown but no where it was mentioned the Stock Transfer of goods.

7. In view of the above discussion and findings I hereby reject the appeal filled by the appellant.