Case Title: Madhagoni Venkaiah v. Deputy Assistant Commissioner (State Tax) & Others
Court: High Court of Andhra Pradesh, Amaravati
Petition No.: W.P. No. 29363 of 2024
Date of Judgment: 24 December 2024
Category: Detention and seizure of goods under Section 129 of CGST/SGST Act
Relevant Sections: Section 129 of CGST Act, 2017
Facts (Paras 1–4)
The petitioner, owner of a lorry bearing No. TS05 UC 2257, was transporting 21,625 kg of iron and steel scrap from Vijayawada to Hyderabad. The vehicle was seized on 03.11.2024 by the Deputy Assistant Commissioner (State Tax) on the allegation of irregularities, despite the goods being accompanied by a valid E-way bill generated by the consignor. The petitioner contended that the seizure violated Section 129 of the CGST Act, as no show cause notice was issued within seven days, nor any order passed thereafter. It was argued that the transport was legitimate, duly documented, and therefore, the seizure was unlawful.
Questions before the Court (Paras 3–4, 7–10)
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Whether seizure of the goods and vehicle was valid under Section 129 of the CGST Act when the consignment was accompanied by an E-way bill.
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Whether non-issuance of a notice or order within the time frame prescribed under Section 129 invalidates the detention.
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Whether the High Court could intervene in factual disputes such as origin of goods, validity of E-way bills, and alleged circular trading.
Observations (Paras 6–12)
The respondent department argued that the driver was served with detention and show cause notices in compliance with Section 129. It was alleged that two E-way bills were generated within two minutes — one for transport from Hyderabad to Vijayawada and another for return to Hyderabad — suggesting possible circular trading to evade tax. The address of the consignor also allegedly lacked capacity to store such large quantities of scrap.
The Court noted that there existed serious factual disputes—particularly whether notices were indeed served and whether goods were genuinely moved from Autonagar (Vijayawada) or the consignor’s address. These factual matters could not be adjudicated in writ jurisdiction under Article 226.
Judgment (Para 12–13)
The Court declined to quash the seizure but directed the 1st Respondent (Deputy Assistant Commissioner) to complete proceedings under Section 129 within two weeks. The petitioner or his representative was ordered to appear on 26.12.2024 at 11:00 A.M. to present all objections. The Court emphasized adherence to statutory timelines and disposed of the writ petition with no order as to costs.
Summary of Cases Referred
| Case | Court | Issue | Verdict |
|---|---|---|---|
| No other case specifically cited in this judgment | – | – | – |
Between Fine Lines (Practical Takeaway)
Transporters and traders must ensure that E-way bills reflect genuine movement of goods with proper documentation and matching logistical data. Even minor discrepancies, such as quick turnaround of goods, may trigger suspicion of circular trading. However, where factual disputes arise, High Courts may refrain from interference and instead direct completion of proceedings within statutory timelines under Section 129 of the CGST Act.
Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”
