High Court slams GST Officers for Unauthorized Seizure of Truck & Scrap

Authentic Metals, a scrap dealer, was transporting copper scrap with all the right paperwork invoice and e-way bill included when tax officers intercepted the truck. After a physical check, the authorities skipped straight to proposing a massive Rs. 18.92 lakh fine and initiated confiscation proceedings (MOV-10). The dealer paid the entire fine and asked for the truck to be released while the case was being finalized. However, the department refused to budge, holding onto the goods and the vehicle without a formal detention order.

Issue Before Court: Can GST authorities hold onto goods during confiscation proceedings without a formal detention order, and does the law allow for “provisional release” before the final order is passed?

HC Decided: The Kerala High Court clarified two major points. First, it ruled that “provisional release” doesn’t technically exist under Section 130 (confiscation). The option to pay a fine instead of losing your goods only kicks in after the final order is signed.

However, the Court delivered a sharp rebuke regarding the department’s “illegal” hold on the property. It ruled that under Article 300A, the government can’t just seize property on a whim; they must follow the law to the letter. Since the officers never issued a formal detention order under Section 129, they had no legal right to keep the truck parked in their lot. The Court ordered the immediate release of the goods upon a simple bond, reminding officials that they can’t turn a procedural delay into an unauthorized seizure.

To Read Full Judgment, Download PDF Given Below