Recently Hon’ble Kerala HC gave its decision in case of Daily fresh fruits India Pvt. Ltd. Vs. Assistant State Tax officer, Commissioner State Goods and Services Tax department, State of Kerala that in case of a bonafide dispute regarding classification of the rate of Tax between transitor of the goods and the squad officer, the squad officer may intercept the goods and detain them for the purpose of preparing the relevant papers for effective transmission to the judicial assessing officers and nothing beyond.
Comment: In the current case, the supplier is registered in Tamil Nadu and his Goods were in transit from Tamil Nadu to Kerala which was subsequently detained in Kerala by the Kerala GST authorities. The reason for the detention was wrong HSN classification of goods as per squad officer. Hon’ble Court held that Kerala GST authorities in such a case can not pass any order for detention or seizure and to pay any penalty. They can intercept or detain the goods only for the purpose of preparing some relevant papers/working which can be used to inform the concern jurisdictional assessing officer i.e Tamil Nadu GST authorities in this case, to take any action if deem it appropriate, in accordance with the law.
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