# M/s Anandeshwar Traders, Kanpur Nagar v. The State of U.P. & Ors

- **Citation:** (2021) 2 ILRA 853
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-02-05
- **Case number:** Writ Tax No. 503 of 2020
- **Bench:** Saumitra Dayal Singh
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-anandeshwar-traders-kanpur-nagar-v-the-state-of-u-p-ors-46827
- **Pages:** 5

## Headnote

Tax Law-Petitioner is trader in Pan masala
& other goods-sold disputed goods to a
dealer-two e-way bills and two bilty
prepared-seizure order passed-for reuse
of eway bill-but no such finding recorded
in final order u/s 129 (3) of CGST Act,
2017-presumption cannot be drawn from
e-way
bills-no
evidence
of
actual
transaction
exist-and
no
statutory
presumption available- at appeal stagecertain additional evidence entertainedrules does not allow- impugned order set
aside.

W.P. allowed. (E-7)

List of Cases cited: -

## Text

2 All. M/s Anandeshwar Traders, Kanpur Nagar Vs. The State of U.P. & Ors.
853
those proceedings have been remanded to
the Appeal Authority to examine the same
afresh and to record it's conclusions
whether the petitioner was in possession of
tampered QR Code and Caps. Till the
Appeal Authority reaches a firm conclusion
as to that, in the facts of the present case,
the cancellation of Majhenpurwa licence
may not be examined, simultaneously.

31. Thus, for the purpose of clarification,
it is stated that in case the petitioner succeeds in
establishing that his Gehrukheda licence was
not liable to be cancelled as he had not violated
either section 34(1) (a) or (b) or (c) of the Act,
the
present
proceedings
to
cancel
the
Majhenpurwa license would necessarily fall.
However, if the Appeal Authority does reach a
conclusion adverse to the petitioner (in that
case), it would be for the Licensing Authority to
then examine the existence or otherwise of an
adequate reason or ground to exercise his extraordinary discretionary power to cancel the
Majhenpurwa licence of the petitioner under
Section 34(2) of the Act, keeping in mind the
observations made above.

32. Ordinarily, if the present writ
proceedings were being finalized during the
Excise Year of 2018-2019, the petitioner may
have remained entitled to restoration of his
Majhenpurwa license. However, since that year
is long over, and the current Excise Year 202021 is at its end, it is provided that the orders
dated 05.02.2020 and 30.10.2019 are set aside
and the matter remitted to the licensing
authority with a stipulation that such remanded
proceedings may be recommenced, if required,
only after the decision of the Appeal Authority
with respect to the Gehrukheda license of the
petitioner. If no case is made out for
cancellation
of
petitioner's
Majhenpurwa
license, under section 34(2) of the Act (as
discussed above), his claim for renewal of that
license, if otherwise eligible, for the Excise
Year 2021-22 may be considered by treating
the petitioner to be a continuing licensee, on
notional basis or (if the petitioner does not seek
renewal, at that stage), to grant proportional
refund to him in terms of section 35 of the Act,
as in that case the cancellation of the
Majhenpurwa license would remain referable to
that provision of law only. Such proceedings be
completed by 15.04.2021.

33. The ratio of Gorakhnath (supra)
and Girishdutta Mishra (supra) is found
inapposite. The ratio of those decisions is to the
rights of the original licensee viz a viz his
replacement licensee who came to be appointed
after the license of the original licensee had
been cancelled. Once the license of the original
licensee was restored, the replacement licensee
was found to have no rights surviving with him
to claim continuance of his license. Such is not
the case here. As observed above, the
Gehrukheda license stands cancelled and also, it
is not clear if the Majhenpurwa license had ever
been renewed for the Excise Year 2018-2019.
In any case, that Excise Year is long over.
Hence revival of that license is not warranted, at
this stage.

34. Accordingly, the writ petition is partly
allowed.
----------

(2021)02ILR A 853
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 18.01.2021

BEFORE

THE HON'BLE SAUMITRA DAYAL SINGH, J.

Writ Tax No. 503 of 2020

M/s Anandeshwar Traders, Kanpur Nagar
 ...Petitioner
Versus
The State of U.P. & Ors. ...Respondents
854 INDIAN LAW REPORTS ALLAHABAD SERIES
Counsel for the Petitioners:
Sri Aditya Pandey

Counsel for the Respondent:
C.S.C.

Tax Law-Petitioner is trader in Pan masala
& other goods-sold disputed goods to a
dealer-two e-way bills and two bilty
prepared-seizure order passed-for reuse
of eway bill-but no such finding recorded
in final order u/s 129 (3) of CGST Act,
2017-presumption cannot be drawn from
e-way
bills-no
evidence
of
actual
transaction
exist-and
no
statutory
presumption available- at appeal stagecertain additional evidence entertainedrules does not allow- impugned order set
aside.

W.P. allowed. (E-7)

List of Cases cited: -

1. Mohinder Singh Gill & anr. Vs The Chief
Election Commissioner, New Delhi & ors., AIR
1978 SC 851.

(Delivered by Hon'ble Saumitra Dayal Singh, J.)

1. Heard Sri Aditya Pandey, learned
counsel for the petitioner and Sri Jagdish
Mishra, learned Standing Counsel.

2. The present petition is directed against
the order dated 3.12.2019 passed by the
Additional Commissioner Grade-2 (Appeal)-5,
Commercial Tax, Kanpur, whereby the demand
of tax and penalty amounting to Rs. 29,76,110/-
has been confirmed.

3. Undisputedly, the petitioner is a trader
in Pan Masala and other goods. It claims to
have sold disputed goods to a dealer - Shri
Durga Trading Company, Darjeeling, West
Bengal, against its Tax Invoice nos. SAT/1920/0059, dated 24.11.2019 and SAT/1920/0060, also dated 24.11.2019. Two e-way
bills were also prepared being e-way bill nos.
491096371734 and 491096371789. Both e-way
bills were prepared on 24.11.2019 at 02.32 PM
and 02.33 PM respectively. Bilty of M/s
Ganpati Road Carriers Pvt. Ltd. being LR/321
and
LR/322
were
also
prepared
for
transportation of those goods.

4. It is also undisputed that the goods in
question along with the aforesaid two tax
invoices, e-way bills and, two Bilty were found
accompanying the goods on 28.11.2019 when
the same were intercepted by the revenue
authorities. At the stage of seizure i.e when the
order under Section 129(1) of the Central
Goods and Service Tax Act, 2017 (hereinafter
referred to as the Act) was passed, only one
allegation was proposed to be levelled by the
proper officer - of reuse of the aforesaid e-way
bills. However, at the stage of final order passed
under Section 129(3) of the Central Goods and
Service Tax Act, 2017 (hereinafter referred to
as the Act), no finding came to be recorded to
that effect. Accordingly, by order dated
3.12.2019, the Assistant Commisioner (Mobile
Squad)-4, Kanpur, revised a demand of tax and
penalty Rs. 29,76,110/-.

5. The petitioner's appeal against that
order came to be dismissed by order dated
22.6.2020
passed
by
the
Additional
Commissioner
Grade-2
(Appeal)-5,
Commercial Tax, Kanpur. However, it is
noted that at the stage of the appeal, certain
additional evidence has been entertained by
the appeal authority in the shape of receipt
of toll plaza indicating (according to the
revenue authority) that the goods had
moved on 24.11.2019 itself, at 7.31 PM.
Relying on that, the penalty appeal was
also dismissed. Relying on Rule 138(9) of
the Central Goods and Service Tax Rules,
2017 (hereinafter referred to as the Rules),
it has been reasoned by the appeal authority
that since the goods were not being
2 All. M/s Anandeshwar Traders, Kanpur Nagar Vs. The State of U.P. & Ors.
855
transported immediately upon preparation
of the e-way bills on 24.11.2019, the same
should have been cancelled. Since the eway bills were not cancelled and the
transportation of the goods commenced
four days thereafter, it has been inferred
that the said e-way bills had been reused.

6. Learned counsel for the petitioner
submits that Rule 138(9) of the Rules does
not, in any way, provide either automatic
cancellation of e-way bills or cancellation of
e-way bills by way of necessary option to be
adopted by a dealer, in case, the goods are not
transported within 24 hours of such e-way
bills being generated. Merely because
transportation of the goods did not commence
for four days thereafter, it may not itself lead
to any adverse inference of second use of that
e-way bills. Second, it has been submitted
that, in any case, the reason for assessment
and penalty has to be tested on the strength of
the original order. The reasoning given
therein could not be supplemented or
supplanted at the stage of appeal. Relying on
Rule 112 of the Rules, it has been further
submitted that the right to lead additional
evidence at the stage of appeal, has been
granted to the appellant only. Therefore, the
appeal authority has wrongly allowed the
application of the revenue authority who was
the respondent in the appeal. In that regard,
reliance has been placed on the decision of
the Supreme Court in the case of Mohinder
Singh Gill & Anr. Vs. The Chief Election
Commissioner, New Delhi & Ors., AIR
1978 SC 851.

7. On the other hand, learned Standing
Counsel opposed the petition and submitted
that, in case the petitioner had not transported
the goods as disclosed on the e-way bills, he
should have acted in accordance with law and
cancelled the same under Rule 138(9) of the
Rules. The fact that the e-way bills were not
cancelled, itself is a evidence of the goods
having been twice transported, thereon. Then,
referring to the evidence received by the
appeal authority, it has been submitted that
clearly the petitioner-assessee had made
second use of the e-way bills.

8. Having heard learned counsel for the
parties and having perused the record, the
rights of the parties, in the instant case, are
found to be governed by the Rule 138(9) of
the Rules, which reads as below:-

"Where an e-way bill has been
generated under this rule, but goods are
either not transported or are not transported
as per the details furnished in the e-way bill,
the e-way bill may be cancelled electronically
on the common portal within twenty four
hours of generation of the e-way bill:

Provided that an e-way bill cannot
be cancelled if it has been verified in transit
in accordance with the provisions of rule
138B:

Provided further that the unique
number generated under sub-rule (1) shall be
valid for a period of fifteen days for updation
of Part B of FORM GST EWB-01."

9. The Rule does not prescribe that
the dealer must necessarily cancel the eway bill if no transportation of the goods is
made within 24 hours of its generation. It
certainly does not provide any consequence
that may follow if such cancellation does
not take place. On the contrary, the Rule
permits a dealer to cancel the e-way bill
only if the transportation does not take
place and the dealer choses to cancel such
e-way bill within 24 hours of its generation.

10. Even if the dealer does not cancel
the e-way bill within 24 hours of its
856 INDIAN LAW REPORTS ALLAHABAD SERIES
generation, it would remain a matter of
inquiry to determine on evidence whether
an actual transaction had taken place or not.
That would be subject to evidence received
by the authority. As such it was open to the
seizing authority to make all fact inquiries
and ascertain on that basis whether the
goods had or had not been transported
pursuant to the e-way bills generated on
24.11.2019. Since the petitioner-assessee
had pleaded a negative fact, the initial onus
was on the assessing authority to lead
positive evidence to establish that the
goods had been transported on an earlier
occasion. Neither any inquiry appears to
have been made at that stage from the
purchasing dealer or any toll plaza or other
source, nor the petitioner was confronted
with any adverse material as may have
shifted the onus on the assessee to establish
non-transportation of goods on an earlier
occasion.

11. The presumption could not be
drawn on the basis of the existence of the eway bills though there did not exist
evidence of actual transaction performed
and
though
there
is
no
statutory
presumption available. Also, there is no
finding of the assessing authority to that
effect only. Mere assertion made at the end
of the seizure order that it was clearly
established that the assessee had made
double use of the e-way bills is merely a
conclusion drawn bereft of material on
record. It is the reason based on facts and
evidence found by the assessing authority
that has to be examined to test the
correctness of the order and not the
conclusions, recorded without any material
on record.

12. Then, as to the power of the
appeal authority to entertain additional
evidence, again, there can be no doubt that
Rule 112 of the Rules does not allow for
additional evidence to be led at the instance
of the respondent in the appeal. In the case
of penalty or assessment, where the appeal
may be filed by the assessee alone, the
correctness of the order is to be tested on
the strength of the reasons given in that
order and not on the basis of any
supplementary or other material that may
be brought on record by the revenue
authority during the appeal proceedings. To
do that would be to allow the order
impugned in an appeal proceeding to be
tested and affirmed on fresh reasons,
existing outside the assessment or penalty
order. Clearly, that is impermissible and
against the principle laid down by the
Supreme Court in Mohinder Singh Gill
(supra). In absence of specific Rule of
procedure allowing the appeal authority to
admit additional evidence at the behest of
the respondent, it never became open to it
to confront the petitioner with that evidence
and draw it's independent conclusions
based thereon.

13. In view of the above position,
though the petitioner-assessee has also
disputed the correctness of the additional
evidence, that issue is not required to be
gone into in the present case. Accordingly,
it is found that the order passed by the
appeal
authority
is
erroneous,
being
contrary to the provisions of law. The
appeal authority had no jurisdiction to
examine fresh evidence at the behest of the
revenue or record fresh reasons to support
original order. The proper authority, had
not recorded any reason to establish
evasion of tax or attempt to evade tax or
even reuse of the documents by the
petitioner. Though he raised that issue in
the seizure proceedings, he did not record
any finding that effect in the final order
dated 3.12.2019 passed under Section
2 All. M/s Proview Realtech Pvt. Ltd. Vs. State of U.P. & Ors.
857
129(3) of the Act. He simply rejected the
explanation furnished by the assessee
without
recording
any
reason
and
consequently imposed tax and penalty.

14. In view of the above, no useful
purpose would be served to remand the
proceeding now as that would amount to
giving the revenue a second inning to built
a fresh case that too after being aware of
the defense set out by the assessee in the
first leg of the proceedings. The order dated
3.12.2019 passed by the proper authority
under Section 129(3) of the Act is found to
be perverse and is set aside. Any amount
that may have been deposited by the
petitioner-assessee, may be returned to it,
in accordance

15. Accordingly, the present petition
is allowed.
----------
(2021)02ILR A857
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 12.01.2021

BEFORE

THE HON'BLE MUNISHWAR NATH
BHANDARI, J.
THE HON'BLE ROHIT RANJAN AGARWAL, J.

Writ C No. 27147 of 2020
&
Writ C No. 27104 of 2020
&
Writ C No. 27175 of 2020

M/s Proview Realtech Pvt. Ltd....Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Siddharth Singhal, Sri Ankita Singhal

Counsel for the Respondents:
C.S.C., Sri Wasim Masood

A. Civil Law - Real Estate Regulation -
Real Estate (Regulation and Development)
Act, 2016- Sections 21, 29, 30, 40(1),
40(2), 43(5) - U.P. Real Estate (Regulation
and
Development)
(Agreement
for
Sale/Lease) Rules, 2018 - U.P. Real Estate
(Regulation
and
Development)
Rules,
2016 - Rules 23, 24 -

Real Estate (Regulation and Development)
Act, 2016 - Sections 21, 29, 30 - Whether
one member was competent to pass the
order - S. 30 of Act of 2016 is relevant and
address the issue raised in this petition. It
shows that in case of vacancy, or any defect in
the constitution of the Authority or any defect in
the appointment of a person acting as a
Member of the Authority, the proceeding of the
Authority would not be invalidated. It is not that
whatever composition given u/s 21 of the Act
alone can decide the complaint rather reference
of S. 29 has been given to indicate that
complaint can be heard even in absence of the
Chairperson and, in any case, due to the
vacancy or any defect in the constitution of
Authority,
the
proceeding
would
not
be
invalidated. (Para 8, 9, 13, 14)

Petitioner in the present case, kept silence on
the hearing of the complaint by one Member
and thereby he cannot now be allowed and to
seek invalidation of the proceeding going
contrary to S. 30 of the Act of 2016 and his
conduct.
The
first
argument
cannot
be
addressed simply by referring to S. 21 of the Act
of 2016 but has to be reference of other
provisions, more specifically, S. 30 of the Act of
2016, which was inserted by the legislature to
save the proceeding if the vacancy exist in the
Authority or other reason. It is otherwise a fact
that an order was issued to delegate the power
to a Member for hearing of the complaint, which
was considered by this Court in earlier
judgment. Thus the first ground raised by the
petitioner cannot be accepted. (Para 11, 15)

B. The second issue regarding rate of
interest is nothing but a challenge on the
merit of the order. Writ petition has been held
not to be maintainable as petitioner has remedy