GST Rulings

Goods intercepted due to absence of e-invoice; proceedings to lie u/s.122 not s.129 CGST Act: HC

Order of the High Court of Kerala

[dated 07.11.2024, in OSEL Devices Ltd. vs. Assistant Enforcement Officer, from WP(C) No. 33720 of 2024]

Goods were intercepted while in transit for the sole defect that e-invoice was not generated. Therefore, penalty was imposed under Section 129 of the CGST/SGST Act.

The Hon'ble Court held the aforesaid discrepancy to be minor in nature. It observed that Section 129 ibid should be invoked only for violations which may lead to evasion of tax or where the movement was with an intent to evade tax or in cases of repeated violations (even of a minor nature). In other cases, the authorities should impose penalties having due regard to the provisions of Sections 122 and 126 ibid.

Comments

It is trite that Rule 48 of the CGST/SGST Rules mandates the generation of e-invoice and does not take cognisance of an invoice raised otherwise. However, with the graded introduction of e-invoicing over a period of time, many registered persons have unknowingly failed to adhere to the provisions in a timely manner. Nevertheless, penalty for such contravention is specifically provided under Section 122(3)(e) ibid, up to a maximum of ₹ 50,000.

Srinivasan V, Advocate

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