The appellant has filed this Writ Appeal aggrieved by the judgment of the learned Single Judge in W.P.(C) No.6554 of 2022.

2. The Writ Petition was filed to call for records relating to Ext.Nos.P4 and P6 and to issue a writ of certiorari quashing the same and to direct the 3rd respondent to release the goods which was intercepted and detained as per Ext.P4 notice on production of updated E-way bill.

3. The learned Single Judge, by the impugned judgment, dismissed the Writ Petition holding that the appellant has statutory remedy available and writ petition under Article 226 of the Constitution of India is not warranted.

4. The case of the appellant is that he is a dealer trading in automobile goods and registered under the Central Goods and Service Tax Act (for short ‘the CGST Act’) and the Kerala State Goods and Service Tax Act 2017. He purchased complete set of CNG kit from Jiolat Auto Gas Industries at New Delhi as per invoice dated 26.11.2021, produced as Ext.P2. The goods were despatched through a parcel agency in Delhi generating Part A of E-way bill on 29.11.2021. The Tax Officer Intelligence Squad No.VIII, Ernakulam with Assistant Tax Officers visited the parcel office of Ernakulam, North Railway Station at 10 a.m. on 29.11.2021 and noticed three parcels of cartons with railway marking containing auto parts transported from Delhi to Ernakulam. The Tax Officer contacted the appellant and directed production of documents which are necessary for movements of the goods. On verification, it was seen that there were discrepancies in the E-way bill. The consignment was taken into safe custody. One of the defect pointed out by the Sales Tax Officer is that the E-way bill consists of two parts, Part A and Part B as per Rule 138(2) of the Central Government Sales Tax Rules (for short ‘the CGST Rules’) and Part B was not updated on the common portal before or after the movement of the goods. It was only after interception on 29.11.2021 at 10 am., Part B was updated at 5.30 pm. Hence, notice was issued under Section 129(3) of the CGST Act to the appellant. The appellant, as per Ext.P5, replied that he has not violated any of the Rules and Regulations and he has produced all the documents necessary for the movement of the goods. Taking into consideration of the objection submitted by the appellant, a final order was passed by the Sales Tax Officer on 1.2.2022, whereby the proceedings against the consignor under Section 129(3) of the CGST Act was confirmed.

5. As per the order of confirmation, tax at the rate of Rs,1,64,064/- and penalty at the same rate was also demanded from the appellant. The appellant challenged the notice as well as the final order under Section 129(3) of CGST Act before the learned Single Judge.

6. Heard.

7. Rule 138(2A) of the CGST Rules is the relevant provision, since the goods are transported through Railway, which is extracted as below.-

“138. Information to be furnished prior to commencement of movement of goods and generation of e-way bill –

(1) x x x x x

(2) CENTRAL GOODS AND SERVICES TAX RULES, 2017 (2) Where the goods are transported by the registered p consignor or the recipient of supply as the consignee, whether in his own conveyance or a hired one or a public conveyance, by road, the said person shall generate the e-way bill in Form CST EWB-01 electronically on the common portal after furnishing information in Part B of Form GST EW201

(2-A) Where the goods are transported by railways or by air or vessel the e-way bill shall be generated by the registered person, being, the supplier or the recipient, who shall, either before or after the commencement of movement, furnish, on the common portal, the information in Part of Forms GST EWB-01.

Provided that where the goods are transported by railways, the railways shall not deliver the goods unless the e-way bill required under these rules is produced at the time of delivery.”

8. The Rule reads that where the goods are transported by railways or by air or vessel, the e-way bill shall be generated by the registered person, being the supplier or the recipient, who shall, either before or after the commencement of movement, furnish, on the common portal, the information in Part B of FORM GST EWB-01.

9. The counsel for the appellant submits that Ext.P2 is the Tax Invoice and Ext.P3 is the E way bill showing the Part A by the consignor. He submits that as per Rule 138(2A) of the CGST Rules, part B need to be updated either before or after the commencement of the goods and according to him, updation need be only before taking delivery from the Railways. He further submits that the tax amount of Rs.1,64,064/- is already paid by the consignor and going by Ext.P6 only penalty portion is to be remitted now. He further argues that the proviso to Rule 138(2A) of the CGST Rules put an embargo on the Railways that the goods are to be delivered only if the E-way bill is produced at the delivery. So a cogent reading of Rule 2A with the proviso makes clear that outer time limit for uploading the Part B of the E-way bill is before taking delivery of the goods.

10. The senior Government Pleader argues that the goods seized can be released only invoking Rule 140 of the CGST Rules and for the release bank guarantee equivalent to the applicable tax interest and penalty payable has to be submitted. A cogent reading of Rule 138(2A) of the CGST Rules along with the proviso makes it clear that proviso is independent of Rule 2A and Rule 2A of the CGST Rule is the Rule which is to be followed by the supplier or the recipient and the proviso is to be followed by the Railway. The proviso does not qualify the main Rule and both have to be interpreted independently.

11. Rule 140 of the CGST Rules relate to release of seized goods on provisional basis. In the present case Ext.P6 final order imposing tax and penalty is passed and hence, the argument that bank guarantee for the applicable tax, interest and penalty payable is to be submitted does not deserve merit.

12. When the Writ Appeal came up for admission on 22.4.2022, an interim order was passed directing the 3^rd respondent to release goods which is the subject matter of Ext.P4 and P6, subject to the condition that the appellant furnishes bank guarantee for the penalty amount within a period of one week. The counsel now submits that he has already complied with the condition that the bank guarantee is furnished for the penalty amount. Tax is already paid and the omission is to comply with Part B of E-way bill. Circumstances are singular. The direction of the court is exercised without deviating from the requirement of law in as much as the tax component is already paid, the penalty is furnished in the form of bank guarantee. The assessment is yet to be completed and whatever amounts due after assessment is left after to be adjusted towards the bank guarantee.

13. Taking into consideration of the facts and circumstances of the case as a solitary one, we are of the opinion that since the tax amount has already been remitted by the consignor and the appellant has already furnished bank guarantee for the balance amount equivalent to the tax demanded, the goods in custody of the respondent can be released to the appellant. We have not interpreted Rule 138 of the KGST Rules 2017 and the said fact is left open to be decided in appropriate case.

In the result, this Writ Appeal is allowed, modifying the judgment of the learned Single Judge to the extent that the first respondent is directed to release the goods if the appellant furnishes the bank guarantee for the penalty amount, if not already done. within a period of two weeks from today. The appellant is permitted to produce the details of bank guarantee along with this judgment to the respondents for the release of the goods. It is made clear that the present order passed by us shall not be taken as an interpretation of Rule 138 of the CGST Rules as this order is passed on the facts and circumstances of the case and shall not be treated as a precedent.