This appeal has been filed under Section 107 of the Goods and Services Tax Act, 2017 by the Assistant Commissioner, CGST, Division-G, Sikar. (hereinafter also referred to as “the appellant”) in view of Order-in-Review No. 01/Review/2019-20, dated 4-4-2019 passed by the Commissioner, Central Goods and Services Tax Commissionerate, Alwar under Section 107(2) of the Goods and Services Tax Act, 2017, against the Order-in-Original No. 01/GST/2018, dated 25-9-2018 (hereinafter referred to as “the impugned order”) passed by the Assistant Commissioner, CGST, Division-G, Sikar (hereinafter also referred to as “the adjudicating authority”) in the case of M/s. Ganesh Enterprises, BG-234, Basement, Sanjay Gandhi Transport Nagar, Delhi (hereinafter referred to as the respondent).

2. Brief facts of the case :

2.1 The officers of the CGST Division-G, Sikar have intercepted a conveyance/vehicle bearing No. RJ 23 GB 3811 on 15-8-2018 at Jhunjhunu. The statement of the Driver/person-in-charge of the conveyance was also recorded on 15-8-2018. The goods in movement were inspected under the provisions of sub-section (3) of Section 68 of the CGST Act, 2017 (hereinafter referred to as the ‘Act’) read with Section 20 of the IGST Act, 2017 on 15-8-2018 and following discrepancies were noticed :-

(a)     Prima facie the E-way Bill was found to be defective.

(b)     On enquiry, the driver of the said vehicle revealed that it was his second trip against the same E-way Bill and Invoice.

2.2 The impugned goods and the conveyance used for the transportation of goods were detained under sub-section (1) of Section 129 of Central Goods and Services Tax Act, 2017 read with Section 20 of the Integrated Goods and Services Tax Act, 2017 by issuing an order of detention in FORM GST MOV-06 on 17-8-2018.

2.3 Further, a show cause notice in FORM GST MOV-07 was served on 17-8-2018 with the person-in-charge of the conveyance i.e. Driver and Sh. Shyam Sunder Sharma, transporter directing them to show cause, within seven days from the receipt of this notice, as to why the proposed tax and penalty may be made payable by them, failing which further proceedings under the CGST Act, 2017 read with IGST Act, 2017 shall be initiated. The notices were received by the driver and Sh. Shyam Sunder Sharma, transporter on 21-8-2018.

2.4 In view of the above, the owner of the goods and conveyance failed to deposit the duty and penalty as proposed under Section 129(1)(a), (b) and (c) of the Act within stipulated time of one week from the date of receipt of FORM GST-MOV-07, wherein they were asked to show cause as to why :-

(i)     Integrated Tax ₹ 5,49,010/- and Cess ₹ 11,76,450/- and penalty under Section 129(1)(a) should not be demanded and recovered from them.

(ii)    Penalty under Section 122(2)(b) should not be imposed and recovered from the supplier of the goods fraudulently.

(iii)   Penalty under Section 122(3) should not be imposed and recovered from the in-charge of the conveyance/driver.

2.5 The respondent failed to deposit the amount and the penalties as proposed in FORM GST MOV-07 within the stipulated time of seven days as prescribed under Section 129(6) of the Act. Thus, as per Section 129(6) of the Act the goods detained or seized, are liable to confiscation under Section 130 of the Act. However, the appellant deposited the amount of IGST and Cess  ₹ 17,25,460/- (₹ 5,49,010/- + Cess ₹ 11,76,450/-) and penalty ₹ 17,25,460/- under Section 129(1)(a) of the Act, penalty ₹ 17,25,460/- under Section 122(2)(b) of the Act and ₹ 25,000/- under Section 122(3) of the Act ibid on 5-9-2018.

2.6 The adjudicating authority vide the impugned Order No. 01/GST/2018, dated 25-9-2018 has passed an order in FORM GST-09 ordering seizure of goods along with conveyance and release the same on payment of applicable tax and penalty. Also imposed penalties of ₹ 17,25,460/- and  ₹ 25,000/- on transporter i.e. M/s. Rajdhani Cargo Carriers and Shri Banshi Lal Yadav, driver and the person-in-charge of the conveyance.

3. The competent authority i.e. Commissioner, Central Goods and Services Tax Commissionerate, Alwar vide their Order-in-Review No. 01/Review/2019-20, dated 4-4-2019 has reviewed the impugned order dated  25-9-2018 and found not legal and proper to the extent of not confiscating the goods and conveyance and not imposing fine in lieu of confiscation of such goods and conveyance and directed the Assistant Commissioner, CGST Division-G, Sikar to file appeal before the Additional Commissioner (Appeals), CGST, Jaipur within the stipulated period for determination of the correctness of the impugned order. Accordingly, the appellant department filed this appeal for the purpose of satisfying as to the correctness, legality or propriety of the impugned order.

4. The appellant also filed an application for condonation of delay for not filing the appeal within the prescribed time period.

5. The respondent vide letter C. No. APPL/JPR/CGST/AL/10/IV/ 2019/9118-21, dated 15-1-2010 were called upon to file a memorandum of cross-objection against the appeal filed by the department. The letter was returned undelivered with the remark by the postal authority “No such person at this address”. Again on 28-1-2020 the letter was sent to deliver to the respondent through CGST Division-G, Sikar. But the respondent has not filed any memorandum of cross-objection. Personal hearing in the matter was fixed for 19-5-2020. None appeared either from the side of appellant or from the side of respondent for defending their case. Thereafter, personal hearing through video conference in the matter was again fixed for hearing on 4-6-2020. None appeared either from the side of appellant or from the side of respondent. Thereafter, personal hearing in the matter was again fixed for hearing on 12-6-2019 through video conferencing. None appeared either from the side of appellant or from the side of respondent on that date too. I find that sufficient opportunities have been given to the respondent for defending their case and accordingly, the principle of natural justices have been complied with, therefore I take up the matter for decision on the basis of records available in the file.

6. I have carefully gone through the facts of the case and grounds of appeal. Taking into account the submission made for delay in filing the appeal, I hereby condone the delay.

7. I observe that the issue involved in the instant matter is that the appellant department is now contesting that since the respondent failed to deposit the amount of tax and penalties as proposed in FORM GST MOV-07 within the stipulated time of seven days as prescribed under Section 129(6) of the CGST Act, 2017. Thus, as per Section 129(6) of the Act, the goods detained or seized, are liable to confiscation under Section 130 of the Act.

For better appreciation the relevant provisions of law are reproduced as under :-

That Section 129(6) of the CGST Act, 2017 reads as under :

Section 129. Detention, seizure and release of goods and conveyance in transit.

“(6) Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1), within seven days of such detention or seizure, further proceeding shall be initiated in accordance with the provisions of Section 130 :

Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of seven days may be reduced by the proper officer”

8. I find that Section 129(6) of the CGST Act, 2017 stipulates that where the amount of tax and penalties proposed and determined by the adjudicating authority should be automatically deposited within seven days, failing which proceedings shall be initiated in accordance with the provisions of Section 130. Section 130 provides for confiscation of goods or conveyance and penalty under Section 122 and also provide option to pay fine in lieu of confiscation. In the  present case, the respondent failed to deposit the duty and penalty within seven days accordingly, the adjudicating authority was required to take the action under Section 130 of the Act. In view of the above discussion and as per legal provisions, I find that the adjudicating authority has erred in passing the impugned order by not confiscating the goods and conveyance or not imposing fine in lieu of confiscation under Section 130 of the Act. Therefore, I allow the appeal of the department to that extent.

9. The appeal is disposed of in above manner.