{"id":237055,"date":"2020-10-09T16:00:18","date_gmt":"2020-10-09T10:30:18","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=237055"},"modified":"2020-10-16T11:58:32","modified_gmt":"2020-10-16T06:28:32","slug":"madras-hc-officials-getting-salaries-in-first-week-every-month-not-conscious-to-cost-of-adjudicatory-delays-hc-while-directing-provisional-release-of-confiscated-goods","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2020\/10\/09\/madras-hc-officials-getting-salaries-in-first-week-every-month-not-conscious-to-cost-of-adjudicatory-delays-hc-while-directing-provisional-release-of-confiscated-goods\/","title":{"rendered":"Madras HC | “Officials getting salaries in first week every month not conscious to cost of adjudicatory delays”: HC while directing provisional release of confiscated goods"},"content":{"rendered":"

Madras High Court:\u00a0<\/strong>G.R. Swaminathan, J., directed the confiscated goods to be released on a provisional basis noting the delay on the part of Authorities in the adjudication of the matter.<\/p>\n

Petitioner a dealer registered under the Goods and Services Tax Act who imports toys from China. It also purchases goods from Delhi-based dealers.<\/p>\n

Dealer’s Stand<\/span><\/h3>\n

Dealer’s state that the returns till March 2020 have been filed and there are no arrears. Due to the lockdown restrictions amidst the pandemic, the business was shut down since April, 2020.<\/p>\n

Following the partial lifting of restrictions, the petitioner reopened the business. Superintendent, CGST conducted a search at the petitioner’s place of business.<\/p>\n

After the search operation, mahazar was drawn which was followed by a seizure order.<\/p>\n

The said orders of seizure and prohibition issued by respondent 3 have been put to a challenge.<\/p>\n

Analysis & Decision<\/span><\/h3>\n

Bench while addressing and analysing the issue, stated that,<\/p>\n

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Lord Atkin in his celebrated dissent in Liversidge v. Anderson,<\/em> (1942) AC 206, proclaimed that laws speak the same language in war as in peace and that the words have only one meaning.<\/p>\n<\/blockquote>\n

Likewise, laws speak the same language during normal as well as in pandemic times.<\/p>\n

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“…contemporary imperatives demand that courts, whenever possible, ought to adopt that approach which will kick- start the economy.”<\/p>\n<\/blockquote>\n

Court also referred to Section 67 (1) and (2) of the Central Goods and Services Tax Act, 2017 which talks about the Power of inspection, search and seizure.<\/p>\n

Supreme Court in ITO v. <\/span><\/em>Lakhmani Mewal Das,<\/em> (1976) 3 SCC 757,<\/a> held that\u00a0<\/span><\/p>\n

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“…the existence of the belief can be challenged by the assessee but not the sufficiency of reasons for the belief. The expression “reason to believe” does not mean a purely subjective satisfaction on the part of the officer. It must be held in good faith. It cannot be merely a pretence. It is open to the Court to examine whether the reasons for the formation of the belief have a rational connection with or a relevant bearing on the formation of the belief and are not extraneous or irrelevant for the purpose of the section.”<\/span><\/em><\/p>\n

Evading GST<\/span><\/p>\n

In the present matter, the impugned proceedings were initiated based on the intelligence developed by <\/span>CGST (HPU), Madurai that the petitioner is evading GST by mis-declaring the <\/span>goods while importing.<\/span><\/strong><\/p>\n

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It has been shown that the stock register was not maintained at the petitioner’s place of business, hence the Court doesn’t want to quash the seizure order, through the order of prohibition has to be necessarily interfered with.<\/p>\n

No show-cause notice to date after the lapse of 40 days was issued.<\/p>\n

In view of the above, Court stated that the respondent may not be in a hurry, they can afford to wait. Officials who get their salaries in the first week of every month may not be conscious of the cost of delays in such cases.<\/p>\n

Further, the Court added that Adjudication proceedings may go on for months. That is why the statute provides for the provisional release of the detained goods.<\/span><\/p>\n

Therefore, the Court directed the respondents to release the goods on a provisional basis and on taking a personal bond with a payment of Rs 2 lakhs.<\/p>\n

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While parting with its decision, Bench stated in regard to the Chinese products that,<\/p>\n

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“…general market is flooded with Chinese goods. The public must make a conscious choice to encourage swadeshi products.”<\/p>\n

“The Indian entrepreneur must rise to the occasion. He must ask himself as to why the chinese products are preferred and he must come out with alternatives. There must be no compromise in quality. At the same time, the price factor should also be borne in mind.”<\/p>\n<\/blockquote>\n

Petition was partly allowed in the above terms. [Tvl.Rising International Co. v. Commr. of Central GST and Central Excise,\u00a0 2020 SCC OnLine Mad 2951<\/b><\/a>, decided on 06-10-2020]<\/span><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Madras High Court:\u00a0G.R. Swaminathan, J., directed the confiscated goods to be released on a provisional basis noting the delay on the part <\/p>\n","protected":false},"author":8808,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[31142,39924,43737,6241,11801,29785,40154,3103],"class_list":["post-237055","post","type-post","status-publish","format-standard","hentry","category-casebriefs","category-highcourts","tag-business","tag-covid-19","tag-dealer","tag-gst","tag-high-court","tag-law","tag-lockdown","tag-Tax_evasion"],"yoast_head":"\nMadras HC | "Officials getting salaries in first week every month not conscious to cost of adjudicatory delays": HC while directing provisional release of confiscated goods | SCC Times<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2020\/10\/09\/madras-hc-officials-getting-salaries-in-first-week-every-month-not-conscious-to-cost-of-adjudicatory-delays-hc-while-directing-provisional-release-of-confiscated-goods\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Madras HC | "Officials getting salaries in first week every month not conscious to cost of adjudicatory delays": HC while directing provisional release of confiscated goods\" \/>\n<meta property=\"og:description\" content=\"Madras High Court:\u00a0G.R. 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