Areca-Nut Trader’s ₹1.6-Lakh GST Penalty Quashed Over Kolkata–Assam Dispatch Mismatch; GSTAT Finds Valid E-Way Bills, Consignments Reported and Tax Paid

On 3 February 2024, tax authorities intercepted a vehicle carrying two consignments of areca nuts for Ankit Traders in Kanpur.

The driver produced the relevant e-invoices and e-way bills, which identified Purbo Kitterbond, Assam, as the dispatch location. The goods receipts issued by CKT Cargo Movers, Kolkata, identified Kolkata as the dispatch location.

Ankit Traders explained that the goods had travelled by rail from Assam to Kolkata and then by road to Kanpur; Kolkata was therefore shown on the road-transport receipts.

The adjudicating authority imposed a penalty of ₹1,60,216 under Section 129 of the CGST/SGST Acts read with Section 20 of the IGST Act, and the first appellate authority upheld it.

Ankit Traders appealed to the Tribunal.

The Tribunal applied Section 129 of the CGST/SGST Acts, read with Section 20 of the IGST Act, as the statutory basis for the penalty imposed for the alleged discrepancy in the documents accompanying the goods.

It relied on Jindal Pipes Ltd. v. Deputy State Tax Officer, W.P. (MD) No. 17211 of 2024, and K.S. Traders v. Deputy Commercial Tax Officer (INT), Roving Squad, W.P. (MD) No. 23310 of 2025, for the principle that a technical or minor discrepancy in transport documents does not, by itself, justify a Section 129 penalty in the absence of circumstances indicating tax evasion.

It also relied on Saumya v. Union of India, Writ Tax No. 664 of 2025, and Sangeeta Jain v. Union of India, Writ Tax No. 783 of 2023, for the principle that a technical error, without a discrepancy in the goods or evidence of an intent to evade tax, does not warrant seizure or penalty under Section 129.

The Tribunal found that valid e-invoices and e-way bills had been produced at interception and accepted the explanation that the goods were transported first by rail from Assam to Kolkata and then by road to Kanpur.

It further noted that both consignments were reflected in the statutory returns and that the applicable tax had been paid; the record therefore did not establish that the goods were unaccounted for or that the discrepancy was intended to evade tax.

Applying the cited authorities, the Tribunal treated the mismatch as a technical irregularity insufficient, on these facts, to sustain a penalty under Section 129.

It allowed the appeal, quashed the orders dated 5 February 2024 and 25 October 2025, directed that any penalty paid be refunded in accordance with law, and ordered the parties to bear their own costs.