GST Penalty on Expired E-Way Bill Quashed Citing Technical Auto-Population Error: Allahabad High Court

The Allahabad High Court has quashed a GST penalty and seizure order imposed solely on the ground of expiry of an e-way bill, holding that such expiry, when caused by a technical auto-population error and without any intent to evade tax, cannot justify punitive action. The bench of Justice Piyush Agrawal noted that motor vehicle chassis are regulated goods requiring registration and cannot be clandestinely traded like unregistered commodities. All relevant documents clearly reflected the destination as Ghazipur, Uttar Pradesh, and were available with the authorities at the time of interception. The case arose from a writ petition filed by M/s Metropolis Logistics Pvt. Ltd., a GST-registered logistics company, challenging an order dated 26 November 2019 passed by the Additional Commissioner, rejecting its appeal under Section 129(3) of the U.P. GST Act. The impugned order confirmed seizure of goods and imposed a penalty of ₹30.63 lakh. The petitioner was transporting motor vehicle chassis from Ashok Leyland Limited, Udham Singh Nagar (Uttarakhand), to M/s Pawansut Automobile India Pvt. Ltd. at Ghazipur, Uttar Pradesh. The consignment was duly accompanied by a tax invoice, e-way bill, trade certificate under Rule 43 of the Central Motor Vehicle Rules, 1989, and temporary registration documents. While generating the e-way bill on 10 August 2018, the distance was auto-populated as 170 kilometres instead of the actual distance of approximately 800 kilometres. Due to this incorrect auto-generated distance, the e-way bill was valid only up to 12 August 2018. During transit, the vehicle was intercepted and the goods were seized solely on the ground that the e-way bill had expired. Importantly, no discrepancy was found in the goods, invoice, destination, or tax particulars. The only allegation was expiry of the e-way bill. The petitioner contended that The incorrect distance was auto-populated by the GST system after Part-A was filled, and such fields could not be amended manually. There was no intent to evade tax, as all statutory documents accompanied the goods. The e-way bill expired due to a technical glitch beyond the petitioner’s control. A fresh e-way bill was generated before the final order under Section 129(3) was passed. The department, on the other hand, argued that it was the petitioner’s responsibility to ensure correctness of the e-way bill and that a new e-way bill should have been generated if any error was noticed. The Court also accepted the petitioner’s submission that the distance and validity fields in the e-way bill were auto-generated and could not be altered by the assessee. This fact was not disputed by the State. Crucially, the Court held that expiry of an e-way bill due to technical reasons cannot automatically be equated with tax evasion. The GST portal provides complete traceability of movement of goods, and the department was fully aware of the transaction. In the absence of any other defect or allegation of tax evasion, initiation of seizure proceedings was unjustified. The High Court relied on a consistent line of judgments, including the Supreme Court decision in Assistant Commissioner (ST) v. Satyam Shivam Papers Pvt. Ltd., and several earlier Allahabad High Court rulings, which held that minor or technical lapses in e-way bills do not warrant harsh penalties when there is no intent to evade tax. The Allahabad High Court set aside the seizure and penalty order and allowed the writ petition. The Court categorically ruled that the impugned order could not be sustained in law and deserved to be quashed. Case Details Case Title: M/S Metropolis Logistics Pvt Ltd Versus Additional Commissioner And 2 Others Case No.: WRIT TAX No. - 233 of 2020 Date: 16/12/2025 Counsel For Petitioner: Ankur Agarwal, Suyash Agarwal Counsel For Respondent: A.S.G.I., C.S.C. Click Here To Read Order Read More: GST Vehicle Seizure Challenged Despite Available Statutory Appeal: Allahabad HC Refuses Writ Relief

GST Penalty on Expired E-Way Bill Quashed Citing Technical Auto-Population Error: Allahabad High Court

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