# M/s Nokia Solutions & Networks India Pvt. Ltd v. State of U.P. & Ors

- **Citation:** (2024) 3 ILRA 1801
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2024-02-06
- **Case number:** Writ Tax No. 1034 of 2019
- **Bench:** Shekhar B. Saraf
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-nokia-solutions-networks-india-pvt-ltd-v-state-of-u-p-ors-51620
- **Pages:** 4

## Headnote

1802 INDIAN LAW REPORTS ALLAHABAD SERIES
C.S.C.

The Goods and Services Tax (GST) Act,
2017- Sections 129 & 107 - E-Way Bill -
Part-B not filled at the time of interception -
goods accompanied by valid tax invoices and
Part-A of e-way bill - Part-B subsequently
updated
before
detention
order
-
no
discrepancy in goods, quantity or value - no
material to show mens rea or intention to evade
tax - mere presumption based on short distance
of transportation not sufficient - levy of tax and
penalty based on surmises and conjectures -
authorities bound to record findings based on
investigation indicating tax evasion - non-filling
of Part-B alone, without intent to evade tax,
does not attract penalty under Section 129(3) -
reliance placed on Roli Enterprises, VSL Alloys
and Citykart Retail cases - detention order and
appellate order illegal - penalty and tax demand
quashed - security directed to be refunded.

Writ petition allowed. (E-9)

Case Law Cited

## Text

3 All. M/s Nokia Solutions & Networks India Pvt. Ltd. Vs. State of U.P. & Ors.
1801
filing of an appeal without a demand does
not mean that the intention of the
legislature was different."

31. The aforesaid judgment squarely
applicable to the facts of the case and the
appeal is held to be maintainable.

32. This Court in M/s Galaxy
Enterprises v. State of U.P. and 2 others2
held that if rectified documents were
produced before the authorities before the
seizure order was passed, the same were
liable to be considered.

33. The case of the petitioner stands
on a better footing.

34. Since all the documents have been
admittedly produced before the authorities
at the time of inspection, there was no
cause for detention, seizure or imposition
of the penalty as has been done by the
authorities in this case.

35. It is noteworthy that the revenue is
not challenged the authenticity of the bills
or the fact that they were not duly filled it
or the details were absent in the said bills.
No irregularity in the bills have been
pointed out on behalf of the revenue.

36. The bills contained all relevant
details of the goods and the tax are liable to
be paid.

37. The impugned order dated
04.01.2023
whereby
the
Assistant
Commissioner, Commercial Tax, Mobile
Squad-VII, Ghaziabad as well as the order
dated 09.05.2023 passed by the respondent
No.3/learned appellate authority/Additional
Commissioner, State Tax, Mobile Squad,
Unit-7, Ghaziabad are liable to be quashed
and are quashed.

38. The amount deposited shall be
forthwith refunded to the petitioner in
accordance with law.

39. The writ petition (tax) is allowed.

40. The case at hand reflects that not
only the mobile squad had misdirected
itself in law but the appellate authorities
have failed to redeem the errors. The Court
has no hesitation to observe that a honest
tax payer in the facts of this case has been
unnecessarily harassed by the revenue
authorities. The Court will say no further.
However, it is for the revenue authorities to
ensure that the officers are properly trained
and alerted to the relevant provisions of
law.

41. It is open to the revenue
authorities to conduct regular courses for
upgrading the domain knowledge of the
officers in the field and the appellate
authorities
also
to
circulate
relevant
judgments on a regular basis to the
officials.
----------
(2024) 3 ILRA 1801
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.02.2024

BEFORE

THE HON'BLE SHEKHAR B. SARAF, J.

Writ Tax No. 1034 of 2019

M/s Nokia Solutions & Networks India
Pvt. Ltd. ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Ninshant Mishra, Sri Tanmay Saadh

Counsel for the Respondent:
1802 INDIAN LAW REPORTS ALLAHABAD SERIES
C.S.C.

The Goods and Services Tax (GST) Act,
2017- Sections 129 & 107 - E-Way Bill -
Part-B not filled at the time of interception -
goods accompanied by valid tax invoices and
Part-A of e-way bill - Part-B subsequently
updated
before
detention
order
-
no
discrepancy in goods, quantity or value - no
material to show mens rea or intention to evade
tax - mere presumption based on short distance
of transportation not sufficient - levy of tax and
penalty based on surmises and conjectures -
authorities bound to record findings based on
investigation indicating tax evasion - non-filling
of Part-B alone, without intent to evade tax,
does not attract penalty under Section 129(3) -
reliance placed on Roli Enterprises, VSL Alloys
and Citykart Retail cases - detention order and
appellate order illegal - penalty and tax demand
quashed - security directed to be refunded.

Writ petition allowed. (E-9)

Case Law Cited

1. M/s Roli Enterprises v. State of U.P. and
others, Writ Tax No. 937 of 2022, decided on
16.01.2024 (Allahabad High Court).

2. VSL Alloys (India) Pvt. Ltd. v. State of U.P.
and another, 2018 NTN (Vol. 67) - 1 (Allahabad
High Court).

3. M/s Citykart Retail Private Limited through
Authorized Representative v. Commissioner,
Commercial Tax and another, 2023 U.P.T.C.
(Vol. 113) - 173 (Allahabad High Court).

(Delivered by Hon'ble Shekhar B. Saraf, J.)

1. Heard Sri Tanmay Sadh, learned
counsel holding brief of Sri Nishant
Mishra, learned counsel for the petitioner
and Sri Ravi Shanker Pandey, learned
Additional Chief Standing Counsel for the
respondents.

2. This is a writ petiton under Article
226 of the Constitution of India wherein the
petitioner is aggrieved by the order levying
penalty and the order of the Appellate
Authority dated May 18, 2019 passed by
respondent No.2/Additional Commissioner
Grade-2 (Appeal)-II, Commercial Tax,
Meerut under Section 107 of the Act.

3. Learned counsel appearing on
behalf of the petitioner submits that the
following facts are not in dispute :

a. Petitioner supplied goods to
M/s Idea Cellular Limited, Mangal Pandey
Nagar, Meerut vide tax invoices no.
5204046997
&
5204046998
dated
18.6.2018 of Rs 1,16,583.98/- and Rs
22,77,755.98/- respectively, after charging
IGST @ 18%;

b. After preparing invoices dated
18.6.2018, Petitioner generated e-way bills
no. 7710 1550 4255 & 7410 1550 4256 in
respect of the two transactions, which were
valid till 21.6.2018. However, since the
vehicle number was not informed by the
transporter, hence Part-B of e-way bills
was not completed/filled up by the
Petitioner while generating the e-way bills;

c. Even though the transporter
was instructed to start movement of
vehicles, only after updating Part B of eway
Bills,
yet
due
to
some
miscommunication
between
transporter
and the driver, the driver of the Vehicle No.
DL1M-9583 started transportation from
Delhi to Meerut, without updating Part-B
of e-way bills;

d. On 19.6.2018, when the
aforesaid vehicle was entering Meerut, the
same was stopped by Respondent No. 3 at
06:50 AM. Upon interception, driver
produced the papers available with him
relating to the transaction in question. in
question;

e. Immediately, after receiving the
news of interception, transporter informed
3 All. M/s Nokia Solutions & Networks India Pvt. Ltd. Vs. State of U.P. & Ors.
1803
the same to the Petitioner whereupon
Petitioner generated e-way bills again by
updating Part-B of e- way bills at 09:50
AM in the morning of 19.6.2018;

f. Even though, the deficiency,
even if, in Part B of e-way bills was cured
by Petitioner by updating by Part B of eway bills on 19.6.2018 at 09:50 AM and the
same was also produced before Respondent
No. 3, yet Respondent No. 3 proceeded to
pass detention order dated 20.6.2018 on
the sole ground that at the time of
interception, Part B of e-way bills was not
updated. On the same date, Respondent No.
3 also issued notice under Section 20 of
IGST Act directing the driver to appear and
explain as to why not tax and penalty be
demanded for release of goods and vehicle;

g. Upon receipt of the aforesaid
notice, Petitioner submitted reply before
Respondent No. 3 stating the circumstances
in which Part B of e-way bills was not
updated initially and that the same was
updated prior to passing of the detention
order;

h. Respondent No. 3 then passed
order dated 26.6.2018, by rejecting the
reply
furnished
by
Petitioner
and
confirming demand of tax and penalty of Rs
3,65,274/- each, on the sole ground that
Part B of e-way bills were not filled and
thus the same was not a valid e-way bills
for transportation of goods;

i. Aggrieved with the order dated
26.6.2018, Petitioner filed statutory appeal
before Respondent No. 2 on various
grounds mentioned in the memo of appeal;
and

j. By impugned order dated
18.5.2019, Respondent No. 3 dismissed the
appeal filed by Petitioner and confirmed
the
order
dated
26.6.2018
(wrongly
mentioned
as
20.6.2018)
passed
by
Respondent No. 3.

4. Learned counsel appearing on
behalf of the petitioner relies upon a
judgment of this Court in M/s Roli
Enterprises vs. State of U.P. and others
(Writ Tax No.937 of 2022 decided on
January 16, 2024) wherein this Court had
considered
two
judgements
of
the
Allahabad High Court in VSL Alloys
(India) Pvt. Ltd v. State of U.P. and
another reported in 2018 NTN [Vol.67]-1
and M/s Citykart Retail Private Limited
through Authorized Representative vs.
Commissioner Commercial Tax and
Another
reported
in
2023
U.P.T.C.
[Vol.113]-173 and held that non filling up
of Part 'B' of the E-Way Bill by itself
without any intention to evade tax would
not lead to imposition of penalty under
Section 129(3) of the Act.

5. In the present case, apart from the
factual aspect that the Part B of E-Way
Bills was not filled up, there is no material
on record to show that the petitioner had
any mens rea to evade tax. It is to be noted
that the invoice, that was being carried,
matched with the goods in the truck and the
goods were not in variance with the
invoice. Furthermore, the only reason upon
which the presumption has been made by
the authority concerned is that the tax may
have been evaded as the distance between
Delhi and Meerut is about 75 kilometers
which would allow the petitioner to do
multiple trips and evade tax.

6. The crux of the issue herein is that
the petitioner explained the reason of non
filling up of Part B of the E-Way Bills to
the authorities. However, the authorities
have not considered the explanation and
1804 INDIAN LAW REPORTS ALLAHABAD SERIES
rejected the same on the basis of only the
factual aspect that the distance between
Delhi and Meerut is about 75 kilometers.
The presumption that has been made by the
authorities that there was intention to evade
tax is based only on the factual matrix that
the distance between Delhi and Meerut is
only about 75 kilometers, which could have
allowed the petitioner to carry out multiple
trips. In my view, no other material has
been brought on record by the authorities to
indicate that there was any mens rea on the
part of the petitioner to evade tax.
Furthermore, it is to be noted that the other
columns of the E-Way Bills such as
description of the goods, quantity of the
goods and value etc. were found to be the
same as in the tax invoice accompanying
the goods. Furthermore, there was no
mismatch between the goods that was
being carried out in the vehicle and the
invoice.

7. In light of the above, the reason of
presumption of evasion of tax is without
any basis in law, and accordingly, the order
of detention and subsequent appellate order
are illegal and required to be set aside.

8. It is to be noted that it is upon the
authorities to pass orders under Section 129
of the Act on the basis of some
investigation that may indicate an intention
to evade tax. The same cannot be solely on
surmises and conjectures.

9. In light of the above, the order
levying penalty and order dated May 18,
2019 are quashed and set-aside. The writ
petition is allowed. Consequential reliefs to
follow. The respondents are directed to
return the security to the petitioner within
four weeks from date.
----------
(2024) 3 ILRA 1804
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 01.03.2024

BEFORE

THE HON'BLE SHEKHAR B. SARAF, J.

Writ Tax No. 1081 of 2019

M/s Jhansi Entp. Nandanpura, Jhansi
 ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Shubham Agrawal

Counsel for the Respondent:
Sri Ravi Shankar Pandey, Addl. C.S.C.

The Goods and Services Tax (GST) Act,
2017- Section 129(3) - registered dealer -
goods in transit - vehicle intercepted - neither
invoice nor e-way bill were accompanying the
goods at the time of interception - order for
physical verification/inspection - e-way bill
generated after the interception - documents
produced
subsequent
to
interception
-
contravention of the provisions of the Act and
Rules - contravention cannot be treated as a
mere common mistake - burden of proof shifts
to the assessee - presumption may be raised
that there is an intention to evade tax -
petitioner not able to rebut the presumption of
evasion of tax - absence of invoice and e-way
bill not explained with proper and reasonable
explanation - mere furnishing of documents
subsequent to interception cannot absolve the
petitioner from liability of penalty - purpose of
imposing penalty is to act as a deterrent - if the
goods
had
not
been
intercepted,
the
Government would have been out of its pocket
with respect to the GST payable - application of
Section 129(3) of the Act valid and just in law -
no interference required .

Writ petition dismissed. (E-9)

Cases Cited: