CBIC issues circular 41 for clarification on interception of conveyance

clarifying the procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances.

Circular No. 41/15/2018-GST

CBEC-20/16/03/2017-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
****

New Delhi, Dated the 13th April, 2018

To,
The Principal Chief Commissioners/Chief Commissioners/Principal Commissioners/Commissioners of Central Tax (All)/The Principal Directors General/ Directors General (All)
Madam/Sir,
Subject: Procedure for interception of conveyances for inspection of goods inmovement, and detention, release and confiscation of such goods and conveyances Reg
Sub-section (1) of section 68 of the Central Goods and Services Tax Act, 2017(hereinafter referred to as the CGST Act) stipulates that the person in charge of aconveyance carrying any consignment of goods of value exceeding a specified amount shallcarry with him the documents and devices prescribed in this behalf. Sub-section (2) of thesaid section states that the details of documents required to be carried by the person in chargeof the conveyance shall be validated in such manner as may be prescribed. Sub-section (3) ofthe said section provides that where any conveyance referred to in sub-section (1) of the saidsection is intercepted by the proper officer at any place, he may require the person in charge
of the conveyance to produce the documents for verification, and the said person shall beliable to produce the documents and also allow the inspection of goods.
1.1 Rules 138 to 138D of the Central Goods and Services Tax Rules, 2017 (hereinafter eferred to as the CGST Rules) lay down, in detail, the provisions relating to e-way bills.
As per the said provisions, in case of transportation of goods by road, an e-way bill isrequired to be generated before the commencement of movement of the consignment. Rule
138A of the CGST rules prescribes that the person in charge of a conveyance shall carry theinvoice or bill of supply or delivery challan, as the case may be; and in case of transportationof goods by road, he shall also carry a copy of the e-way bill in physical form or the e-waybill number in electronic form or mapped to a Radio Frequency Identification Deviceembedded on to the conveyance in such manner as may be notified by the Commissioner.
1.2 Section 129 of the CGST Act provides for detention, seizure and release of goods andconveyances in transit while section 130 of the CGST Act provides for the confiscation of
goods or conveyances and imposition of penalty.
2. In this regard, various references have been received regarding the procedure to befollowed in case of interception of conveyances for inspection of goods in movement and
detention, seizure and release and confiscation of such goods and conveyances. In order toensure uniformity in the implementation of the provisions of the CGST Act across all the
field formations, the Board, in exercise of the powers conferred under section 168 (1) of theCGST Act, hereby issues the following instructions:

(a) The jurisdictional Commissioner or an officer authorised by him for this purpose shall, by an order, designate an officer/officers as the proper officer/officers to conduct interception and inspection of conveyances and goods in the jurisdictional area specified in such order.

(b) The proper officer, empowered to intercept and inspect a conveyance, may intercept any conveyance for verification of documents and/or inspection of goods. On being intercepted, the person in charge of the conveyance shall produce the documents related to the goods and the conveyance. The proper officer shall verify such documents and where, prima facie, no discrepancies are found, the conveyance shall be allowed to move further. An e-way bill number may be available with the person in charge of the conveyance or in the form of a printout, sms or it may be written on an invoice. All these forms of having an e-way bill are valid. Wherever a facility exists to verify the e-way bill electronically, the same shall be so verified, either by logging on to http://mis.ewaybillgst.gov.in or the Mobile App or through SMS by sending EWBVER to the mobile number 77382 99899 (For e.g. EWBVER 120100231897).

(c) For the purposes of verification of the e-way bill, interception and inspection of the conveyance and/or goods, the proper officer under rule 138B of the CGST Rules shall be the officer who has been assigned the functions under sub-section (3) of section 68 of the CGST Act vide Circular No. 3/3/2017 GST, dated 05.07.2017.

(d) Where the person in charge of the conveyance fails to produce any prescribed document or where the proper officer intends to undertake an inspection, he shall record a statement of the person in charge of the conveyance in FORM GST MOV- 01. In addition, the proper officer shall issue an order for physical verification/inspection of the conveyance, goods and documents in FORM GSTMOV-02, requiring the person in charge of the conveyance to station theconveyance at the place mentioned in such order and allow the inspection of thegoods. The proper officer shall, within twenty four hours of the aforementionedissuance of FORM GST MOV-02, prepare a report in Part A of FORM GSTEWB-03 and upload the same on the common portal.

(e) Within a period of three working days from the date of issue of the order in FORMGST MOV-02, the proper officer shall conclude the inspection proceedings, eitherby himself or through any other proper officer authorised in this behalf. Wherecircumstances warrant such time to be extended, he shall obtain a written permissionin FORM GST MOV-03 from the Commissioner or an officer authorized by him,for extension of time beyond three working days and a copy of the order ofextension shall be served on the person in charge of the conveyance.

(f) On completion of the physical verification/inspection of the conveyance and thegoods in movement, the proper officer shall prepare a report of such physicalverification in FORM GST MOV-04 and serve a copy of the said report to theperson in charge of the goods and conveyance. The proper officer shall also record,on the common portal, the final report of the inspection in Part B of FORM GSTEWB-03 within three days of such physical verification /inspection.

(g) Where no discrepancies are found after the inspection of the goods and conveyance,the proper officer shall issue forthwith a release order in FORM GST MOV-05 andallow the conveyance to move further. Where the proper officer is of the opinionthat the goods and conveyance need to be detained under section 129 of the CGSTAct, he shall issue an order of detention in FORM GST MOV-06 and a notice inFORM GST MOV-07 in accordance with the provisions of sub-section (3) ofsection 129 of the CGST Act, specifying the tax and penalty payable. The saidnotice shall be served on the person in charge of the conveyance.

(h) Where the owner of the goods or any person authorized by him comes forward tomake the payment of tax and penalty as applicable under clause (a) of sub-section(1) of section 129 of the CGST Act, or where the owner of the goods does not comeforward to make the payment of tax and penalty as applicable under clause (b) ofsub-section (1) of the said section, the proper officer shall, after the amount of taxand penalty has been paid in accordance with the provisions of the CGST Act andthe CGST Rules, release the goods and conveyance by an order in FORM GSTMOV-05. Further, the order in FORM GST MOV-09 shall be uploaded on thecommon portal and the demand accruing from the proceedings shall be added in theelectronic liability register and the payment made shall be credited to such electronicliability register by debiting the electronic cash ledger or the electronic credit ledger
of the concerned person in accordance with the provisions of section 49 of the CGSTAct.

(i) Where the owner of the goods, or the person authorized by him, or any person otherthan the owner of the goods comes forward to get the goods and the conveyancereleased by furnishing a security under clause (c) of sub-section (1) of section 129 ofthe CGST Act, the goods and the conveyance shall be released, by an order inFORM GST MOV-05, after obtaining a bond in FORM GST MOV-08 along witha security in the form of bank guarantee equal to the amount payable under clause(a) or clause (b) of sub-section (1) of section 129 of the CGST Act. The finalisationof the proceedings under section 129 of the CGST Act shall be taken up on priorityby the officer concerned and the security provided may be adjusted against thedemand arising from such proceedings.

(j) Where any objections are filed against the proposed amount of tax and penaltypayable, the proper officer shall consider such objections and thereafter, pass aspeaking order in FORM GST MOV-09, quantifying the tax and penalty payable.On payment of such tax and penalty, the goods and conveyance shall be releasedforthwith by an order in FORM GST MOV-05. The order in FORM GST MOV-09shall be uploaded on the common portal and the demand accruing from the ordershall be added in the electronic liability register and, upon payment of the demand,such register shall be credited by either debiting the electronic cash ledger or theelectronic credit ledger of the concerned person in accordance with the provisions ofsection 49 of the CGST Act.

(k) In case the proposed tax and penalty are not paid within seven days from the date ofthe issue of the order of detention in FORM GST MOV-06, action under section130 of the CGST Act shall be initiated by serving a notice in FORM GST MOV-10,proposing confiscation of the goods and conveyance and imposition of penalty.

(l) Where the proper officer is of the opinion that such movement of goods is beingeffected to evade payment of tax, he may directly invoke section 130 of the CGSTAct by issuing a notice proposing to confiscate the goods and conveyance in FORMGST MOV-10. In the said notice, the quantum of tax and penalty leviable undersection 130 of the CGST Act read with section 122 of the CGST Act, and the fine inlieu of confiscation leviable under sub-section (2) of section 130 of the CGST Actshall be specified. Where the conveyance is used for the carriage of goods orpassengers for hire, the owner of the conveyance shall also be issued a notice underthe third proviso to sub-section (2) of section 130 of the CGST Act, proposing toimpose a fine equal to the tax payable on the goods being transported in lieu of
confiscation of the conveyance.

(m) No order for confiscation of goods or conveyance, or for imposition of penalty, shallbe issued without giving the person an opportunity of being heard.

(n) An order of confiscation of goods shall be passed in FORM GST MOV-11, aftertaking into consideration the objections filed by the person in charge of the goods(owner or his representative), and the same shall be served on the person concerned.

Once the order of confiscation is passed, the title of such goods shall standtransferred to the Central Government. In the said order, a suitable time notexceeding three months shall be offered to make the payment of tax, penalty andfine imposed in lieu of confiscation and get the goods released. The order in FORM GST MOV-11 shall be uploaded on the common portal and the demand accruingfrom the order shall be added in the electronic liability register and, upon payment ofthe demand, such register shall be credited by either debiting the electronic cashledger or the electronic credit ledger of the concerned person in accordance with the provisions of section 49 of the CGST Act. Once an order of confiscation of goods ispassed in FORM GST MOV-11, the order in FORM GST MOV-09 passed earlier
with respect to the said goods shall be withdrawn.

(o) An order of confiscation of conveyance shall be passed in FORM GST MOV-11,after taking into consideration the objections filed by the person in charge of theconveyance and the same shall be served on the person concerned. Once the order ofconfiscation is passed, the title of such conveyance shall stand transferred to theCentral Government. In the order passed above, a suitable time not exceeding threemonths shall be offered to make the payment of penalty and fines imposed in lieu ofconfiscation and get the conveyance released. The order in FORM GST MOV-11shall be uploaded on the common portal and the demand accruing from the ordershall be added in the electronic liability register and, upon payment of the demand,such register shall be credited by either debiting the electronic cash ledger or theelectronic credit ledger of the concerned person in accordance with the provisions ofsection 49 of the CGST Act.

(p) The order referred to in clauses (n) and (o) above may be passed as a common orderin the said FORM GST MOV-11.

(q) In case neither the owner of the goods nor any person other than the owner of thegoods comes forward to make the payment of tax, penalty and fine imposed and getthe goods or conveyance released within the time specified in FORM GST MOV-11,the proper officer shall auction the goods and/or conveyance by a public auctionand remit the sale proceeds to the account of the Central Government.

(r) Suitable modifications in the time allowed for the service of notice or order forauction or disposal shall be done in case of perishable and/or hazardous goods.

(s) Whenever an order or proceedings under the CGST Act is passed by the properofficer, a corresponding order or proceedings shall be passed by him under therespective State or Union Territory GST Act and if applicable, under the Goods andServices Tax (Compensations to States) Act, 2017. Further, sub-sections (3) and (4)of section 79 of the CGST Act/respective State GST Acts may be referred to in caseof recovery of arrears of central tax/State tax/Union territory tax.

(t) The procedure narrated above shall be applicable mutatis mutandis for an order orproceeding under the IGST Act, 2017.

(u) Demand of any tax, penalty, fine or other charges shall be added in the electronicliability ledger of the person concerned. Where no electronic liability ledger isavailable in case of an unregistered person, a temporary ID shall be created by theproper officer on the common portal and the liability shall be created therein. Heshall also credit the payments made towards such demands of tax, penalty or fineand other charges by debiting the electronic cash ledger of the concerned person.

(v) A summary of every order in FORM GST MOV-09 and FORM GST MOV-11shall be uploaded electronically in FORM GST-DRC-07 on the common portal.

3. The format of FORMS GST MOV-01 toFORMS GST MOV-11 are annexed to this Circular.
4. It is requested that suitable standing orders and trade notices may be issued topublicise the contents of this Circular.
5. Difficulties, if any, in implementation of the above instructions may be brought to thenotice of the Board at an early date. Hindi version will follow.

(Upender Gupta)
Commissioner (GST)

Click Here to Buy CA Final Pendrive Classes at Discounted Rate