Allahabad HC Quashes GST Penalty for Technical Lapse in E-Way Bill, Found No Intention to Evade Tax
The present writ petition (Neutral Citation No. – 2025:AHC:197620), dated November 10, 2025, has been filed by a company named M/S Archana Plasmould (Petitioner) against the State of Up and 2 Others (Respondent) in the Allahabad High Court. The ruling has been given by Honourable Justice Piyush Agarwal. The company challenged orders dated January 13, 2025, and July 27 2024, passed by respondents.
Background of Case:
The petitioner is a proprietorship firm registered under the GST Act, having GSTIN 24AARPP7310B1ZW and is engaged in the business of manufacturing and supplying plastic moulds. The company said that on July 25, 2024, its goods were detained by the GST officials merely on the ground that Part B of the e-way bill accompanying the goods was not generated. Thereafter, a penalty order was issued to the company under section 129(3) of the GST Act.
The aggrieved company filed an appeal challenging the order; however, the authority dismissed the appeal vide the impugned order.
Petitioner’s Arguments:
The authorised representative of the petitioner submitted that at the time of interception of the vehicle and goods in question, they produced all the documents asked for and the goods were also found as per the description mentioned in the tax invoice.
Additionally, it was said that at the time of issuing the penalty order, the department did not share any reason behind the action. Further, the ground later shared, i.e., Part B of the e-way bill accompanying the goods, was not generated; it was not an intentional attempt to evade payment of tax, but rather was due to some technical glitch.
Further added, all documents other than Part B of the e-way bill were fully submitted, but the tax authorities did not even mention a single one of these aforementioned words, indicating there was no intention to evade tax.
To support its side, the petitioner cited some earlier judgments:
- M/s Tata Hitachi Construction Machinery Company Private Limited vs. State of U.P. & Others [Writ Tax No. 2148/2025, decided on 09.05.2025]
- M/s Citykart Retail Private Limited vs. the CCT & Another [Writ Tax No. 22285/2019, decided on 06.09.2022]
- M/s Roli Enterprises vs. State of U.P. & Others [Writ Tax No. 937/2022, decided on 16.01.2024]
- M/s Metloy Cast vs. Additional Commissioner, Grade -2 and another (Neutral Citation No. 2025:AHC:121373)
Court’s Findings and Final Decision
When the court listened to both sides of the arguments, the court noted that there was no intention to evade payment of tax, as well as that none of the authorities below had recorded any finding with regard to intention to evade payment of tax.
The court cited the judgment in the case of M/s Tata Hitachi Construction Machinery Company Private Limited (supra), where the authority ruled that non-filling of the e-way bill is not liable to attract a penalty under section 129(3) of the GST Act. The cases of M/s Citykart Retail Private Limited (supra) and M/s Roli Enterprises (supra) also held the same.
Further, the record reveals that due to a technical error, Part B of the e-way bill could not be filled, which has not been disputed at any stage.
HC’s Final Decision
In view of the aforesaid findings, the court ruled in favour of the petitioner and allowed the writ petition. The court quashed both the impugned orders dated January 13, 2025, and July 27 2024.
The respondents have been directed to refund any amount deposited by the petitioner during the present proceedings within a period of two months from the date of production of a certified copy of this order.
Citation: M/S Archana Plasmould Vs State Of Up And 2 Others (Allahabad High Court); WRIT TAX No. – 1592 of 2025; 10/11/2025
