GST Authorities Cannot Jump from Section 129 to Section 130 Without Completing Statutory Procedure: Gujarat HC:

GST Authorities Cannot Jump from Section 129 to Section 130 Without Completing Statutory Procedure: Gujarat HC Krishna Industries, engaged in the business of sale of metal scrap and duly registered under the GST law, was transporting goods from Ahmedabad to Sarkhej when its truck was intercepted by the State Tax Officer, Mobile Squad, Ahmedabad on 22.11.2023. Proceedings were initially initiated under Section 129 of the CGST Act for detention of goods and conveyance, including physical verification in Form GST MOV-04. However, during the pendency of the matter, the department issued a notice dated 02.12.2023 in Form GST MOV-10 under Section 130 of the Act, proposing confiscation of goods and conveyance. The petitioner challenged this action contending that the authorities had abandoned the proceedings under Section 129 and had impermissibly invoked Section 130 midway, contrary to settled law and earlier decisions of the Gujarat High Court. Central Issue: Whether the GST authorities can directly invoke confiscation proceedings under Section 130 of the CGST Act after initiating detention proceedings under Section 129, without completing the statutory process and without establishing intent to evade tax. HC's Decision: The Hon'ble High Court held that the issue was squarely covered by its earlier decision dated 11.12.2025. The Court reiterated that Sections 129 and 130 operate in distinct fields and prescribe different consequences. While confiscation under Section 130 is permissible where there is a clear element of intention to evade tax, the authorities cannot abandon the procedure under Section 129 and straightaway resort to confiscation. In the present case, after intercepting the conveyance and initiating action under Section 129, the department directly issued a notice under Section 130 without completing the detention proceedings. Such action was found to be unsustainable in law. Thus, the impugned notice dated 02.12.2023 issued in Form GST MOV-10 and all consequential proceedings were quashed. To Read Full Judgment, Download PDF Given Below