Ankit Traders vs COMMISSIONER STATE GOODS AND SERVICES TAX DEPARTMENT/, Shri Prakash Yadav Joint Commissioner(IT) State Tax Headquarters Lucknow

GSTAT

State Bench Varanasi
Division Bench Court No. Court I
APL/4/VRN/2026
ANKIT TRADERS .............Appellant
Versus

COMMISSIONER STATE TAX & ORS. .............Respondent
Quorum
Hon’ble Narendra Bahadur Yadav, Member(Judicial)
Hon’ble Ananjai Kumar Rai, Member (Technical)
Counsel for Appellant
DR. SWAYAMBHAV MANU,
ADVOCATE

Counsel for Respondent
SHRI MANAV KUMAR
VIKAS, DEPUTY
COMMISSIONER, STATE
TAX VARANASI
Form GST APL-04A
[See rules 113(1) & 115]
Summary of the order and demand after issue of order by the GST Appellate
Tribunal
whether remand order : No
Order reference no. :
ZN090381026000060H
Date of order : 28/10/2026
1. GSTIN/Temporary ID/UIN - 09BMRPA7370P1Z8
2. Appeal Case Reference no. - APL/4/VRN/2026 Date - 18/03/2026
Name of the appellant - Ankit Traders , [email protected] ,
3.
7317581832

Name of the respondant -
1. Shri Prakash Yadav Joint Commissioner(IT) State Tax Headquarters
Lucknow , [email protected] , 7235002314
2. COMMISSIONER STATE GOODS AND SERVICES TAX
DEPARTMENT/
4.
5. Order appealed against - AD0904240124939

(5.1) Order Type - Enforcement Order
(5.2) Ref Number - ZD091025227464H Date - 31/10/2025
Personal Hearing - 28/10/2026 13/10/2026 06/10/2026 01/09/2026
6.
30/07/2026
7. Status of Order under Appeal - Reject - Order under Appeal is annulled
Order in brief - 1. The present appeal has been filed by M/s Ankit
Traders, Kanpur, against the orders dated 05.02.2024 and 25.10.2025
passed by the Adjudicating Authority and First Appellate Authority,
respectively, imposing and confirming a penalty of ₹1,60,216/- under
Section 129 of the CGST/SGST Acts read with Section 20 of the IGST
Act. 2. The vehicle carrying two consignments of areca nuts was
intercepted on 03.02.2024. The driver produced the relevant e-invoices
and e-way bills. The penalty was imposed due to a discrepancy between
the place of dispatch mentioned in the goods receipts issued by M/s
CKT Cargo Movers, Kolkata, and that mentioned in the e-way bills,
which indicated Purbo Kitterbond, Assam. 3. The appellant submitted
that the goods were transported by train from Assam to Kolkata and
thereafter by road to Kanpur. Hence, Kolkata was mentioned as the
place of dispatch in the goods receipts prepared for road transportation.
It was further contended that both consignments were duly accounted
for in the statutory returns and the applicable tax had been paid. 4. The
point for determination is whether the discrepancy in the place of
dispatch warrants penalty under Section 129 of the CGST/SGST Acts. 5.
The records reveal that valid e-invoices and e-way bills were produced
at the time of interception. The explanation regarding transportation in
two legs is plausible. Both transactions were reflected in the statutory
returns, and no material was established to demonstrate that the goods
were unaccounted for or that the discrepancy was intended to evade tax.
6. The Hon’ble Madras High Court in M/s Jindal Pipes Ltd. v. Deputy
State Tax Officer, W.P. (MD) No. 17211 of 2024, and the Hon’ble
Allahabad High Court in M/s Saumya v. Union of India, Writ Tax No.
664 of 2025, considered the effect of technical discrepancies in transport
8.

documents in the absence of circumstances indicating tax evasion. 7. In
the facts and circumstances, the discrepancy, without evidence of
unaccounted goods or an attempt to evade tax, does not justify the
penalty imposed. 8. Accordingly, the appeal is allowed. The impugned
orders dated 05.02.2024 and 25.10.2025 are set aside. The penalty, if
already paid, shall be refunded in accordance with law. The parties to
bear their own costs. Ordered accordingly.
Summary of Order
9. If demand order then whether demand quantified: No
10. For Other orders and Demand orders which are not quantified:
Issues as
raised by
proper
officer
Issues as determined by
Appellate/Revisional
authority
Order by GST Appellate Tribunal
The appeal is allowed and impugned
orders dated 05.02.2024, and
25.10.2025 passed by Adjudicating
Authority and Appellate Authority
respectively are hereby quashed. The
amount of penalty as imposed upon
appellant, if paid, be refunded by
respondent in accordance to
procedure and law. The parties to
bear their own respective costs.
the first appellate authority
confirmed the order of
mobile squad officer and
levied penalty under
section 129
Levy of
Penalty

ORDER
Per: Shri Narendra Bahadur Yadav (Member, Judicial):
Assistant Commissioner, Mobile Squad IInd Unit, Chandauli, Uttar
Pradesh intercepted the vehicle no. WB 23 F 6170 loaded with areca
nuts on 03.02.2024 within geographical area of district Chandauli
(Uttar Pradesh). The intercepted vehicle and goods loaded with it
were inspected and searched by tax authorities. The driver of the
vehicle produced the following documents at the time of
interception:
(i). GR Number 12480 dated 29.01.2024 of M/s CKT Cargo Movers,
Kolkata
(ii). E-invoice No. SR/23-24/718 dated 27.01.2024 issued by M/s
SR Enterprise, Purbo Kitterbond Pt. II, Assam (GSTIN:
18BRDPC7186A1ZO)
(iii). E-way Bill No. 821380478184 dated 02.02.2024 regarding
transportation of seventy bags of areca nut from Assam to M/s
ANKIT TRADERS, KANPUR.
(iv). GR Number 12523 dated 30.01.2024 of M/s CKT Cargo
Movers, Kolkata
(v). E-invoice No. SR/23-24/723 dated 30.01.2024 issued by M/s SR
Enterprise, Purbo Kitterbond Pt. II, Assam (GSTIN:
18BRDPC7186A1ZO)

(vi). E-way Bill No. 851381243803 dated 02.02.2024 regarding
transportation of 110 bags of areca nut from Assam to M/s ANKIT
TRADERS, KANPUR.
2. According to version of tax authorities, the vehicle and goods were
seized on the basis of the statement / narration of driver and the bilty
of the transporter regarding transportation of goods from Kolkata
instead of Purbo Kitterbond, Assam which mismatched with place of
dispatch as mentioned in E-way Bill. The place of dispatch had been
mentioned in E-way Bill as Purbo Kitterbond, Assam and place of
supply as Kanpur, Uttar Pradesh. Allegedly supply had been made
by M/s SR Enterprises, Assam to M/s Ankit Traders, Kanpur.
3. The recipient M/s Ankit Traders submitted reply to Mobile Squad
Officer / Adjudicating Authority after receiving Show Cause Notice
(SCN) regarding mismatch of the place of dispatch. The recipient
expressed the alleged mismatch as minor discrepancy, since the
goods were transported with lawful documents, i.e. E-way Bill and
E-invoice, etc. and no intention depicts to evade the tax.
4. Disbelieving averments made in reply to show cause notice, the
Adjudicating Authority imposed penalty of Rs. 160216/- under
section 129 of CGST / SGST Act / section 20 of IGST Act
recognizing the act of supplier and recipient as breach of law and
rules prescribed thereunder vide order dated 05.02.2024.

5. Being aggrieved vide order dated 05.02.2024 passed by the Mobile
Squad Officer, the appeal was preferred under section 107 of GST
Act and same got dismissed vide order dated 25.10.2025. The
Appellate Authority confirmed the order dated 05.02.2024 passed by
Adjudicating Authority.
6. The instant appeal has been filed by appellant M/s Ankit Traders
to redress the grievance arisen due to orders dated 05.02.2024 and
25.10.2025 passed by the Adjudicating Authority and First Appellate
Authority respectively. Such orders have been challenged mainly on
the grounds that the Adjudicating Authority as well as Appellate
Authority both failed to consider that the discrepancy regarding
mismatch in place of dispatch was of minor nature, statement of
driver can not be relied upon and non-existence of intention to evade
the tax.
7. The copy of E-invoices, E-way Bill, copy of impugned orders and
other relevant documents have been uploaded on the portal by
appellant alongwith filing of appeal before the Tribunal.
8. In his written submissions, the appellant submitted that the goods
had actually been dispatched by rail from the supplier's location at
Purbo Kitterbond, Assam, through the nearest railway station at
Monacherra to Kolkata, and thereafter transported by road from
Kolkata to Kanpur. Since M/s CKT Cargo Movers, Kolkata, was

responsible for the road transportation of the goods from Kolkata to
Kanpur, the transporter issued the goods receipt (GR) mentioning
Kolkata as the place of dispatch. Accordingly, the driver made his
statement on the basis of the road transportation documents, wherein
Kolkata was mentioned as the place of dispatch.
9. The learned counsel of appellant Dr. Swayambhav Manu,
Advocate, appeared through virtual mode and learned representative
of respondent State, Shri Manav Kumar Vikas, Deputy
Commissioner, State Tax, appeared in person for advancing oral
arguments.
10. Heard arguments of learned counsel of appellant and learned
representative of respondent. The Bench also perused the record
available on portal.
11. It is an admitted fact that the recipient, M/s Ankit Traders, is
based in Kanpur, Uttar Pradesh, and the tax in respect of the
transactions in question accrued to the State of Uttar Pradesh.
Further, the documents produced at the time of interception, read in
conjunction with the corresponding returns filed by the supplier and
the recipient, establish that both consignments were duly accounted
for and the applicable tax had been duly discharged by the concerned
parties. In view of these facts, there is no basis to allege any intention

to evade tax, particularly when the transactions were duly recorded
in the statutory returns and the tax liability stood duly paid.
12. On the basis of grounds of appeal and submission made on behalf
of both parties, the determinable point exists as: whether merely the
mismatch in place of dispatch without intention to evade tax leads
violation or breach of law and rules attracting imposition of penalty
under section 129 of GST Act.
13. The Adjudicating Authority considered the mismatch in place of
dispatch as breach or violation of law and rules. On such basis the
penalty was imposed under section 129 of GST Act. The order passed
by Adjudicating Authority finds confirmation vide impugned order
dated 31.10.2025 passed by Appellate Authority.
14. The learned counsel of appellant argued that the penalty does not
attract to be imposed under section 129 of GST Act merely on the
basis of mismatch in place of dispatch, particularly where no
intention exists to evade the tax.
15. The learned State Representative appearing for respondent
argued that the intention to evade tax is not a key ingredient for
imposition of penalty under section 129 of GST Act.
16. The learned counsel of appellant and learned representative of
State Tax Department relied upon various case laws. The relevant
case laws will find mention in succeeding paragraphs.

17. In M/s K.S. Traders vs. The Deputy Commercial Tax officer
(INT) Roving Squad, W.P. (MD) No. 23310 of 2025, there was a
mismatch between the place of supply indicated in the tax invoice
and place of dispatch mentioned in the E-way Bill, the consignment
was intercepted and seized by Tax Authorities. Hon’ble Madras High
Court pleased to decide the case relying upon earlier decision of same
Hon’ble Court in M/s Jindal Pipes Ltd vs Deputy State Tax Officer
(INT) Roving Squad-I, Madurai, 2021 (8) TMI 72, rendered on
25.07.2024 in W.P. (MD) NO. 17211 of 2024. On the ratio of law
laid in M/s Jindal Pipes (supra), Hon’ble Court set aside the order
passed by tax authorities regarding imposition of penalty treating the
mismatch of place of supply as technical venial breach of the place
of supply as technical venial breach of the provisions or the minor
discrepancy in the variance in the address in the tax invoice and the
E-way Bill.
18. In para 19 of the judgment rendered in M/s Jindal Pipes Ltd.
(supra), Hon’ble Court observed, “In my view, the imposition of
penalty for technical venial breach of the provisions or the minor
discrepancy in the variance in the address in the tax invoices and the
E-way Bill would not justify the penalty under section 129 (5) of the
respective GST enactments.’’

19. Hon’ble Allahabad High Court in the case of M/s Saumya vs.
Union of India, Writ Tax No. 664 of 2025, decided on 14.07.2025,
held that a mere technical error in the dispatch location mentioned in
the E-way Bill, in the absence of any intent to evade tax or
discrepancy in goods does not warrant seizure or imposition of
penalty under section 129 of the CGST/SGST Act.
20. In M/s Sangeeta Jain vs. Union of India and others (Writ Tax No.
783 of 2023, decided on 22.04.2024), 2024:AHC:70303, Hon’ble
Allahabad High Court ruled that minor clerical or technical errors in
an E-way Bill or invoice, without any proof of mens rea to evade tax
does not attract section 129 of CGST / SGST Act for seizure and
imposition of penalty.
21. The law laid in M/s Saumya (supra) and M/s Sangeeta (supra)
underscores the principal that procedural lapses without substantive
irregularities should not lead to punitive consequences. M/s SK
Traders (supra) and M/s Jindal Pipes Ltd (supra) also evolve same
principle.
22. On the basis of observations made above, the appeal is liable to
be allowed, since at the time of interception valid documents ie. E-
invoices and E-way Bills were produced. Both the transactions are
reflected in the GSTR-2A and no mens rea (guilty intention) exists
to evade the tax and law does not support to penalize the traders under

section 129 of CGST / SGST Act merely on the basis of technical
irregularities.
23. The appeal is allowed and impugned orders dated 05.02.2024,
and 25.10.2025 passed by Adjudicating Authority and Appellate
Authority respectively are hereby quashed. The amount of penalty as
imposed upon appellant, if paid, be refunded by respondent in
accordance to procedure and law. The parties to bear their own
respective costs.
(Order pronounced in open court)

(Ananjai Kumar Rai) (Narendra Bahadur Yadav)

DATED: 28.10.2026