Madhya Pradesh High Court Quashes Penalty Under CGST Act; Mistake In E-way Bill Was Human Error

The Madhya Pradesh High Court in the case Maharaja Cables (C/O Maxwell Logistic Pvt Ltd) Vs Commissioner (GST) State Tax Indore (M.P.) observed and has quashed the penalty imposed under the Central Goods and Service Tax Act, 2017 on a private company after the petitioner argued that while generating the e-way bill the mistake was an inadvertent human error.
The division bench comprising of Justice Sheel Nagu and Justice Virendra Singh observed while allowing the plea that the that the mistake in the e-way bill was bonafide. However, the court stated that the authorities will be at liberty to consider the case of the petitioner for the imposition of a minor penalty while treating the mistake in question to be a clerical mistake as per Circular dated 14.09.2018 which is issued by the Ministry of Finance, Government of India.
In the present case, the petitioner, a private company engaged in the business of copper cables, entered into an agreement with one M/s Bajaj Electricals Ltd. for the supply of certain goods and as per the agreements the goods had to be delivered at the factory in Bhopal. Thus, the agreement ultimately ensued in the transportation of a consignment through M/s Maxwell Logistic Pvt. Ltd. by vehicle.
The court observed that a tax invoice was generated which reflected the destination as well as the registration number of the vehicle. An E-way bill was generated by the petitioner which was required to be carried along with the consignment. Therefore, the address on the E-way bill was mentioned at the registered office of the consignee at Indore, instead of Bhopal.
It was observed that the initiated proceedings under Section 129 of the Central Goods and Service Tax Act, 2017, which ultimately resulted in the passing of the order by which the liability of an additional tax and as well as a penalty was imposed against the petitioner. Thus, the court dismissed the appeal against the order. Before the High Court, the petitioner had challenged the order passed by the original as well as the appellate authorities.
It was contended by the petitioner that the mistake while generating the E-way bill was an inadvertent human error and there was no intention to evade the tax liability.