This appeal has been filed under Section 107 of the Goods and Services Tax Act, 2017 by M/s. Herbalife International India Pvt. Ltd., holding GSTIN 08AAACH8025R1Z3 C/o. Jayem Warehousing Pvt. Ltd., E-734, Nakulpath, Lal Kothi Scheme, Near Vidhansabha and Jyoti Nagar Police Station, Jaipur-302015 (hereinafter also referred to as “the appellant”) against Order No. FORM GST MOV-09, dated 6-12-2018 (hereinafter referred to as “the impugned order”) passed by the Assistant Commissioner, Central Goods & Services Tax Division-H, Jaipur (hereinafter also referred to as “the adjudicating authority”).

Brief facts of the case :-

2.1. The brief facts of the case are that on 30-11-2018 at 18:30 Hrs. conveyance bearing No. RJ14 GK 1082 was intercepted in movement at Sudarshanpura Industrial Area, Jaipur by the Officers of CGST Division-H, Jaipur. The goods in movement were inspected under the provisions of sub-section (3) of Section 68 of the Central Goods and Services Tax Act, 2017 read with sub-section (3) of Section 68 of the State/Union Territory Goods and Services Tax Act or under Section 20 of the Integrated Goods and Services Tax Act, 2017 read with sub-section (3) of Section 68 of the Central Goods and Services Tax Act, 2017 and the following discrepancies were found :-

E-way bill got expired (Not valid for movement).

2.2. In view of the above, the impugned goods and the conveyance used for the movement of goods were detained under sub-section (1) of Section 129 of Central Goods and Services Tax Act, 2017 read with sub-section (3) of Section 68 of the State/Union Territory Goods and Services Tax Act, 2017 or under Section 20 of the Integrated Goods and Services Tax Act, 2017 read with sub-section (3) of Section 68 of the CGST Act, 2017 by issuing an order of detention dated 30-11-2018 in FORM GST MOV-06 and the notice in FORM GST-07 was served on the person in charge of the conveyance on 5-12-2018. Accordingly, the adjudicating authority has passed the impugned order dated 6-12-2018. The adjudicating authority apart from confirming the demand of Tax amounting to ₹ 2,44,521/- (IGST amounting to ₹ 2,44,521/-) also imposed equal penalty ₹ 2,44,521/-. The impugned goods and conveyance used for transport of goods were released in FORM GST MOV-5 vide Ref Form GST MOV-02. No. EWB/49/2918, dated 6-12-2018 after depositing of tax and penalty amount. The owner of the goods i.e. M/s. Herbalife International India Pvt. Ltd., GSTIN 08AAACH8025R1Z3 has deposited the Tax (IGST @ 18% ₹ 2,44,521/- and penalty equal to 100% tax vide Challan No. CPIN 18120800019535, dated 6-12-2018.

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

(i)  that the goods were being transferred from the location of the transporter to the recipient’s location which was within the distance of 50 kilometers.

(ii)  that the consignment was supported by appropriate documents and proof of payment of tax.

(iii)  that no penalty is to be imposed in the absence of any mala fide intent for evasion of taxes on the part of company.

The appellant has also submitted various case laws in support of their contention which may be summarised as under :

Calcutta High Court in CAL-COX Syndicate (P) Limited v. Commissioner of Commercial Taxes [2010] 31 VST 563.

Hindustan Steel Ltd. v. State of Orissa – 1970 [25 STC 211 SC = 1978 (2) E.L.T. J159 (S.C.(].

Hindustan Steel Ltd. v. State of Orissa – (1978) (2) E.L.T. J159 (S.C.) and Akbar Badruddin Jiwani v. Collector of Customs – 1990 (47) E.L.T. 161 (S.C.).

4. Personal hearing in the case has been conducted on 20-1-2020. Shri Manoj Jain, CA and Shri Sanjiv Kumar Mishra, CA appeared for personal hearing. They explained the case in detail and reiterated the submission made in their appeal memorandum and requested to decide the case accordingly as per submission made by them.

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

6. The appellant has contested the imposition of IGST Tax and penalty and in this regard, I find that department had made the case against the appellant on the ground that E-way Bill got expired.

7. I find that M/s. Herbalife International India Pvt. Ltd., Punjab is engaged in direct selling of its products through its large network of distributors dispatched the goods to the appellant i.e. M/s. Herbalife International India Pvt. Ltd., Rajasthan C/o. Jayem Warehousing Pvt. Ltd., E-734, Nakulpath, Lal Kothi Scheme, Near Vidhansabha and Jyoti Nagar Police Station, Jaipur-302015, the owner of the goods is a dealer under the provisions of CGST and RGST Act, 2017 having principal place of business at Jaipur and procures the finished goods from its branches/warehouses located in various other States on stock transfer basis and subsequently sells the same within the State of Rajasthan.

The provisions relating to renewal/cancellation of E-way bill are provided under Rule 138(10) of the Central Goods and Services Tax Rules, 2017, read as follows :-

“Rule 138. (10) – An e-way bill or a consolidated e-way bill generated under this rule shall be valid for the period as mentioned in Column (3) of the Table below from the relevant date, for the distance, within the country, the goods have to be transported, as mentioned in column (2) of the said  Table :-

Provided that the Commissioner may, on the recommendations of the Council, by notification, extend the validity period of an e-way bill for certain categories of goods as may be specified therein :

Provided further that where, under circumstances of an exceptional nature, including transshipment, the goods cannot be transported within the validity period of the e-way bill, the transporter may extend the validity period after updating the details of Part B of Form GST EWB-01, if required.

Explanation 1. – for the purposes of this Rule, the ‘relevant’ date shall mean the date on which the e-way bill has been generated and the period of validity shall be counted from the date at which the e-way bill has been generated and each day shall be counted as the period expiring at midnight of the day immediately following the date of generation of e-way bill.”

I find from the above submission of the appellant that neither the appellant nor the transporter have taken the necessary measures or precautions to ensure extension of validity of the E-way bill or generation of an alternate valid one in terms of Rule 138(10) of Central Goods and Services Tax Rules, 2017 and chose to transport the goods on the old E-way bill which was not a valid document. Therefore, appellant’s contention that the delivery of the impugned goods was delayed on account of shortage of space at the recipient’s warehouse, during which time the E-way bill expired and the e-way bill portal does not allow them raising of multiple e-way bills for same tax invoice is not acceptable. Further, I find that the appellant has taken a plea that the goods were being transferred from the location of the transporter to the recipient’s location which was within the distance of 50 kilometers. In this regard, I have gone through all the related documents submitted by the appellant which can prove the co-relation between the distance of appellant’s warehouse in Jaipur and local address of transporter in Jaipur. The appellant could not prove with documentary evidence their stand that the goods were being transferred from the location of the transporter to the recipient’s location which was within the distance of 50 kilometers. Therefore, detention/seizure of goods and vehicle and initiation of penal proceedings cannot be faulted.

8. In view of the above discussion and findings and after considering the legal requirement of documents in the instant case I hereby reject the appeal filed by the appellant and do not interfere in the impugned order passed by the adjudicating authority.

9. The appeal is disposed of in above manner.