Non-filling of Part-B of E-Way Bill Does Not Attract Penalty Without Tax Evasion Intent

Case Title: Fiserv Merchant Solutions Private Limited v. State of UP and 2 others
Court: High Court of Judicature at Allahabad (Chief Justice’s Court)
Petition No.: Writ Tax No. 1774 of 2025
Judgment Date: 30.04.2025
Coram: Hon’ble Chief Justice Arun Bhansali, Hon’ble Justice Vikas Budhwar
Neutral Citation: 2025:AHC:67039-DB
Category of Dispute: Penalty under GST – Movement of Goods without filling Part-B of E-Way Bill
Relevant Sections: Section 129(3) of the U.P. GST Act, 2017; Rule 138 of the CGST Rules, 2017

Facts of the Case (Ref. Para 1–2, 6)

• The petitioner’s goods were intercepted at U.P. Gate, Ghaziabad.

• Though an e-way bill was carried, Part-B was not filled.

• Notice was issued, and despite appearance, no reply was filed.

• The State Tax Officer imposed a penalty under Section 129(3) of U.P. GST Act citing violation of Rule 138.

• The impugned order only recorded the lapse of Part-B filling but did not record any finding on intention to evade tax.

Questions in Consideration (Ref. Para 3–4)

1. Whether non-filling of Part-B of the e-way bill, without any finding of intent to evade tax, can attract penalty under Section 129(3) of GST Act?

2. Whether the authority is justified in imposing penalty solely for a technical lapse?

Observations of the Court (Ref. Para 6–7)

• The order of the State Tax Officer merely recorded non-filling of Part-B but did not mention any attempt to evade tax.

• The Court reiterated its consistent view that mere technical breach in Part-B of e-way bill, absent any tax evasion intent, does not justify penalty.

• Reference was made to M/s Precision Tools India v. State of U.P. (Writ Tax No. 415 of 2023, decided on 29.01.2024), where the same principle was upheld.

Judgment of the Court (Ref. Para 8)

• The writ petition was allowed.

• The penalty order dated 20.01.2025 was set aside.

• As the petitioner had already deposited the penalty under protest, the Court directed the refund of the penalty within three weeks.

Between Fine Lines (Simplified Summary in 5 Points)

1. Non-filling of Part-B of an e-way bill is a technical lapse, not a substantive tax violation.

2. Penalty under Section 129(3) GST Act requires a finding of intent to evade tax.

3. In this case, no such finding was recorded by the authority.

4. The High Court set aside the penalty, reinforcing the principle of substance over form in GST compliance.

5. Refund of penalty was ordered to the petitioner.

Summary of Referred Cases

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