1. Aggrieved by Ext.P3 order of penalty, the petitioner preferred Ext.P5 appeal before the 2nd respondent. It is stated that 10% of the disputed tax has also been paid as a condition for maintaining the appeal. It is also submitted by the learned counsel for the petitioner that, the goods that were the subject matter of the penalty order, are still in the custody of the department and the petitioner has not cleared the same by furnishing any security. There is a further prayer therefore, for release of the goods pending disposal of the appeal by the 2nd respondent.

2. I have heard the learned counsel appearing for the petitioner and also the learned Government Pleader appearing for the respondents.

3. Smt. Thushara James, the learned Government Pleader would point out that the appeal preferred before the 2nd respondent is against Ext.P3 order which confirms the liability of tax and penalty. The detention of the goods, and the possibility of confiscating the goods pursuant to proceedings under Section 130, that it is envisaged under Section 129(6) still subsist and, in as much as the petitioner has defaulted on the conditions under Section 129(6), he would have to await the out come of the confiscation proceedings under Section 130 before seeking a release of goods. Alternatively, it is submitted, that if the petitioner furnishes a Bank guarantee for the entire tax and penalty determined, then he can seek release of the goods as contemplated under Section 129(5).

On a consideration of the rival submissions, I find force in the submission of the learned Government Pleader that the mere pendency of an appeal cannot be the basis for a direction to release the goods without any security, since the non payment of the security in respect of the goods can independently lead to a confiscation of the goods under Section 130 of the CGST Act. Accordingly, I dispose the writ petition by directing the 2nd respondent to consider and pass orders on Ext.P5 appeal within a period of three months from the date of receipt of a copy of this judgment, after hearing the petitioner. The petitioner may seek a release of goods by furnishing the necessary Bank guarantee for the tax and penalty amounts confirmed against him, pending disposal of the appeal or in the alternative, await the outcome of the confiscation proceedings under the Act.