Section 130 of the CGST Act, 2017 — Goods in Transit –-- The petitioner i.e. the owner of the conveyance challenged the action of the respondents in not releasing the conveyance even though he had paid the fine prescribed under Section 130 (2) of the Act. The court observed that an order of penalty and tax was made against the goods but since the same was not paid within 14 days proceedings under Section 130 of the Act were initiated. The owner of the goods did not come forward to pay the tax and penalty or the fine in view of the confiscation. However, the petitioner went and paid the fine imposed on the vehicle. The court relied on the judgment titled as M/s Shiv Enterprises Vs. State of Punjab and others, decided on 04.02.2022. The principle of vicarious liability can not be extended indefinitely. In the present case to force the owner of the conveyance to pay the tax, penalty and fine on the goods would mean that the owner of the conveyance is also foisted with the vicarious liability of any mis-declaration/fraud by the owner of the goods.

Held that:- The Hon’ble High Court directed that the conveyance be released forthwith. The goods obviously would be confiscated and disposed of by the respondents in accordance with law.