Intention to evade tax not a pre-requisite for liability under GST Law

The Punjab and Haryana HC in Sterile India Pvt. Ltd vs. UOI1, held that the intention to evade tax is not required to be established for the purpose of Section 129 of Central Goods and Services Tax Act, 2017 ("CGST Act").

The Bench observed that the purpose of Section 129 of the CGST Act is to check the evasion of tax and the intention to evade is not required to be established. Therefore, the detention of goods and demand of payment of tax along with a penalty is within the power of the authorities, if the documents accompanying the goods are not in compliance with the provisions of the GST law.

Order for cancellation of registration without assigning any reasons not in accordance with law

The Allahabad HC in M/s ANS Handicrafts vs. Commissioner, Commercial Taxes & Anr.2, while setting aside the order by the Respondent, held that a non-speaking order is unsustainable.

The Court further held that merely giving an opportunity of being heard is not sufficient. The order must necessarily record reasons for the superior court to effectively exercise its power of judicial review.

Advances from prospective buyers for sale of plotted land not taxable under GST law

The Karnataka AAAR in the matter of Rabia Khanum3, held that advance or full consideration received by the owner cum developer for the sale of plotted land is not taxable in terms of Entry 5 of Schedule III of the CGST Act.

The AAAR observed that under the Town & Country Planning Act, the development of the land is mandatory for the owner where a large parcel of land is being sub-divided into small plots. As such, the development work being undertaken by the owner/developer is mandated by law and is not done at the behest of the interested buyer, therefore the amounts received by the interested buyers is only an advance for the purchase of land and not for the development works.

Furthermore, the AAAR held that the transfer of title in the given case is only limited to the dimensions of the plot being sold. The prospective buyer is not receiving ownership, therefore the owner/developer is not rendering any service to the prospective buyer while undertaking the development work. Thus any advance received by the owner/developer in such case is not taxable in terms of Entry 5 of Schedule III of the CGST Act.

Concrete and tangible evidence required for a charge of clandestine removal of goods

The CESTAT Ahmedabad in the case of Siddhnath Shipping and Shakti Forwarders Pvt. Ltd. vs. C.C. Kandla4, held that a concrete and tangible evidence must exist for a charge of clandestine removal of goods and for consequent demand of payment of duty.

The CESTAT observed that no evidence was presented by the authorities to support their allegation of removal of goods without the payment of duty, thus reiterating that the charge of clandestine removal of goods must be based on tangible evidence and not on inferences involving unwarranted assumptions.


1. 2023-VIL-104-P&H

2. 2023-VIL-92-ALH

3. TS-55-AAAR(KAR)-2023-GST


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