E-way bills: Legal provisions allow tax authorities to intercept and even impound vehicles
carrying goods, where e-way bills do not comply with legal framework requirements. The eway bill is a must document, and the captain of the vehicle must carry it the whole time of its
transportation. No-way bill or improper e-way bill may attract a minimum penalty of 200% of
tax payable on goods. E-way bills are mandatory for inter-State transactions and different
States have different threshold limits for intra-State movements. Nevertheless, if a taxpayer
transporting goods from one branch to another branch in same State makes a mistake in Eway bill should be penalized or not? Penalizing such mistakes is justified?
In a recent case, Honorable High court of Allahabad has addressed a similar petition.
According to the order by the Court, the primary element that should be present in any
mistake liable for a penalty, should be intention of taxpayer of evading any tax. Cases, which
happened with petitioner as well, where goods transported from one branch to another
branch in same State, and where petitioner failed to furnish detail under Part B of E-way bill,
should not be penalized if there was no intention by petitioner of tax evasion. At present there
is no specific provision in law which taxes transfer of goods by a principal place of business to
additional place of business in same State or vice versa. Also, upon pointing of mistake by tax
authority to petitioner, petitioner updated Part B well before delivery of goods. Therefore,
penalty should not levy as there was no intention to evade tax.
| SW Point of View: We have a similar view where we believe taxpayers should not be penalized for administrative lapses. In such cases, a system should exist which compares taxpayers history of committing such mistakes and accordingly a decision of penalizing them is taken constructively. |
Source: 2023 (10) TMI 863 – ALLAHABAD HIGH COURT
