Authority: High Court of Gujarat, Ahmedabad

Order Date: 01/10/2026

Case Overview

  • Petitioner: M/s Shreeji Steel, engaged in trading waste and scrap of cast iron.
  • Respondent: State Tax Officer (1), Kutch Mobile Squad.
  • Dispute: Petition challenges Show‑Cause Notice (Form GST MOV‑10) dated 15‑01‑2026 and Order‑in‑Original (Form GST MOV‑11) dated 02‑03‑2026 issued under Section 130 of the CGST Act for confiscation of goods and conveyance.
  • Background Timeline:
  • 12‑02‑2025 – Shreeji Steel purchased goods from M/s A.S. Construction (tax invoice).
  • 13‑02‑2025 – Goods supplied to M/s A.K. Tools Industries; vehicle No.PB 13 BR 9947 inspected by State Tax Officer; verification report (Form MOV‑4) and detention order (Form MOV‑6) issued.
  • 21‑02‑2025 – Show‑cause notice (Form MOV‑10) demanding penalty equal to tax (Rs 2,47,466), fine for goods equal to value (Rs 13,74,812), and fine for conveyance equal to tax (Rs 2,47,468).
  • 25‑02‑2025 – Petitioner requested release of goods and vehicle; documents partially supplied on 01‑03‑2025.
  • 07‑03‑2025 – Petition filed objection; respondent replied on 10‑03‑2025.
  • 02‑04‑2025 – Interim order directed release upon deposit of Rs 5,00,000 plus value of goods Rs 13,74,812; goods and vehicle released.
  • 24‑05‑2025 – Adjudication order under Section 130 passed; later challenged.
  • 11‑12‑2025 – Court quashed earlier notices (Forms MOV‑10/11) in related writs and remanded for reconsideration.
  • 15‑01‑2026 – Fresh show‑cause notice issued (Form MOV‑10) identical to earlier demand.
  • 09‑02‑2026 – Petitioner filed reply.
  • 02‑03‑2026 – Respondent issued Order‑in‑Original (Form MOV‑11) confirming confiscation under Section 130 read with Section 20 of IGST Act.
  • Petitioner’s Submissions: Alleged violation of Rule 138B CGST Rules, lack of jurisdiction, breach of natural‑justice principles; relied on Supreme Court (Ashok Kumar Yadav, Hukum Chand Shyam Lal) and Delhi High Court (Swastik Plastics) precedents; claimed documents were not supplied with notice.
  • Respondent’s Submissions: Stated alternative remedy under Section 107 exists; denied any breach of natural justice or jurisdiction; highlighted cancellation of registration of M/s A.S. Construction on 30‑06‑2025 and that petitioner did not appear at personal hearing on 22‑01‑2026.

Final Outcome

  • The Court examined Rule 138B and found that the physical verification of the conveyance was carried out by a proper officer authorised by the Commissioner, thus no violation.
  • No breach of natural‑justice principles, excess of jurisdiction, or fundamental‑right violation was identified.
  • The Court reiterated that the petitioner has an efficacious statutory remedy under Section 107 of the CGST Act and therefore the writ petition is not maintainable.
  • Orders issued in Form GST MOV‑10 are set aside; the respondent is directed to pass fresh orders in accordance with the observations, but the petitioner must pursue appeal before the designated appellate authority.
  • Consequently, the writ petition is dismissed.

Topics: GST Enforcement, Judicial Review