1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs;

“(i) That the Hon’ble Court may be pleased to issue a writ of Mandamus or a writ in the nature of Mandamus or a writ in the nature of Certiorari, or any other appropriate writ, order or direction, under Article 226 of the Constitution of India, thereby quashing and setting aside the impugned detention order in FORM GST MOV-06 dated 24.12.2021 and to immediately release the goods-in-transit along with truck number GJ-10-TX-0335;

(ii) That the Hon’ble Court may be pleased to issue a writ of Mandamus or a writ in the nature of Mandamus or a writ in the nature of Certiorari, or any other appropriate writ, order or direction, under Article 226 of the Constitution of India directing the Respondent No.4 to forthwith release the goods-in- transit along with the truck Number GJ-10-TX-0335;

(iii) Pending notice, admission and final hearing of this petition, this Hon’ble Court may be pleased to direct the Respondent No.4 to forthwith release the goods-in-transit along with the truck number GJ-10- TX-0335 and further proceedings may pleased be stayed;

(iv) Ex-parte ad-interim relief in terms of Para (iii) may kindly be granted;

(v) Pass any such other order or orders as the Hon’ble Court may deem fit and proper in the circumstances of the case and thus render justice.”

2. The facts, giving rise to this writ application, may be summarized as under;

2.1 The writ applicant is a private limited company incorporated under the provisions of the Companies Act, 1956 having its registered office at Jamnagar, Gujarat. The company is engaged in the manufacture and supply of Brass Bars, Brass Sections, Brass Scrap and other items falling under Chapter-74 of the First Schedule to the Customs Tariff Act, 1975.

2.2 The writ applicant is registered under the Central Goods & Services Tax Act, 2017. The writ applicant placed an order for procurement of brass scrap from a supplier, namely, M/s. Nexus Enterprises, who at the relevant time, was registered in the State of Maharashtra vide GSTIN270GMPS7828L1Z2. In accordance with the contract between the writ applicant and M/s. Nexus Enterprises, the goods were to be supplied to the writ applicant from Maharashtra to be delivered at Jamnagar, State of Gujarat.

2.3 While the goods were in transit, the vehicle was intercepted on 21.12.2021 by the respondent No.4 somewhere between Palsana and Kadodara. The statement of the driver of the vehicle, namely, Shri Munnabhai Sohebkhan was recorded in the FORM GST MOV-01.

2.4 It appears that the respondent No.4, thereafter, ordered for physical verification of the conveyance, goods and documents vide the FORM GST MOV-02 on 21.12.2021 as the respondent No.4 prima facie noticed few defects in the documents.

2.5 Upon physical verification of the goods, a report in the FORM GST MOV-04 dated 24.12.2021 was prepared. It appears from the plain reading of the FORM GST MOV-04 that the description and the quantity of the goods in transit was in accordance with the invoice, E-way bills and other allied documents.

2.6 However, till this date, the respondent No.4 has not released the vehicle along with the goods, and therefore in such circumstances, the writ applicant is here before this Court with the present writ application.

3. Mr. Anand Nainawati, the learned counsel appearing for the writ applicant vehemently submitted that once no discrepancy was noticed in the course of the physical verification of the goods in transit, and the FORM GST MOV-04 is clear in this regard, then the respondent No.4 should have released the vehicle along with the goods. Mr. Nainawati pointed out that despite the above, the respondent No.4 proceeded to issue an order for the detention of the goods in transit vide the FORM GST MOV- 06 dated 24.12.2021. According to the learned counsel, this could not have been done as no discrepancies were recorded in the FORM GST MOV-04 after verification of the goods and the conveyance. He would argue that no notice has been issued to the writ applicant under Section 129(3) of the Act, 2017, demanding penalty pertaining to the goods in transit till this date.

4. The learned counsel would argue that the writ applicant is incurring a huge expenditure towards the demurrage in respect of the conveyance which has been detained for no lawful reason.

5. On the other hand, this writ application has been vehemently opposed by Mr. Utkarsh Sharma, the learned AGP appearing for the respondents.

6. He would submit that the concerned department is contemplating to issue further notice under Section 130 of the Act, calling upon the writ applicant to show-cause as to why the goods and the vehicle should not be confiscated as prima facie the case is one of evasion of tax. Mr. Sharma would submit that one M/s. K.K. Enterprise sold the goods to M/s. Nexus Enterprise and the writ applicant is said to have purchased the goods from M/s. Nexus Enterprise. He pointed out that the GSTIN of M/s. Nexus Enterprise has also been suspended. Mr. Sharma pointed out that the entire transaction appears to have been done in cash and bogus vouchers appear to have been created only with a view to wrongfully avail the input tax credit (ITC).

7. In rejoinder, Mr. Nainawati clarified that all that has been argued by Mr. Sharma has nothing to do so far as his client is concerned. The credentials of M/s. Nexus Enterprise and M/s. K.K. Enterprise respectively may be doubtful, but there is no good reason for the Department to doubt the purchase of the goods in question by the writ applicant from M/s. Nexus Enterprise.

8. Mr. Sharma would submit that this Court may not interfere with the inquiry undertaken by the Department as regards the goods in question.

9. Having heard the learned counsel appearing for the parties and having gone through the materials on record, we are of the view that the detention of the conveyance and the goods for an indefinite period of time is not going to serve any good purpose. As on date, there is no notice issued under Section 130 of the Act for the purpose of confiscation of the conveyance and the goods. It is, ultimately, for the Department to take the final call whether any case for confiscation has been made out or not. This Court should not come in the way of the Department in that regard. However, we should know, at this stage, the liability of the writ applicant towards the tax and penalty, i.e, upto the stage of Section 129 of the Act. In this regard, we requested Mr. Sharma to take instructions from the respondent No.4. Mr. Sharma pointed out that the value of the goods is to the tune of ₹ 39,90,355/- (Rupees Thirty Nine Lakh Ninety Thousand Three Hundred and Fifty Five Only). The tax at the rate of 18% comes to ₹ 7,18,264/- (Rupees Seven Lakh Eighteen Thousand Two Hundred and Sixty Four Only) and the penalty at the rate of 18% comes to ₹ 7,18,264/- (Rupees Seven Lakh Eighteen Thousand Two Hundred and Sixty Four Only). For provisional release of the goods and the vehicle, under Section 129 the total liability towards the tax and penalty comes to ₹ 14,36,528/- (Rupees Fourteen Lakh Thirty Six Thousand Five Hundred and Twenty Eight Only).

10. In view of the aforesaid, we direct the writ applicant to deposit the amount of ₹ 14,36,528/- (Rupees Fourteen Lakh Thirty Six Thousand Five Hundred and Twenty Eight Only) with the respondent No.4, and upon deposit of such amount, the respondent No.4 shall, at the earliest, release the conveyance and the goods. We clarify that we have otherwise not expressed any opinion on the merits of the case. Ultimately, it is for the concerned Department to decide whether any notice for confiscation under Section 130 of the Act should be issued or not. It is always open for the writ applicant also to avail appropriate legal remedy before the appropriate forum in accordance with law if any further action is taken by the respondent No.4.

11. With the above, this writ application is disposed of.