Section 129 Penalty Confined to Undocumented Excess Goods, Not Whole Consignment: GSTAT Lucknow

The GST Appellate Tribunal’s Lucknow Bench dismissed a departmental appeal, holding that 32 excess plywood pieces did not justify penalising 418 pieces covered by a valid invoice and e-way bill.

The GST Appellate Tribunal, Lucknow, has held that where goods found in transit exceed the quantity in the accompanying tax invoice and e-way bill, the penalty under Section 129 of the CGST/UPGST Act, 2017 must be confined to the undocumented excess unless there is evidence against the rest of the consignment. The Bench of Santosh Kumar Srivastava, Member (Judicial), and Arvind Kumar, Member (Technical), dismissed the Department’s second appeal under Section 112(3) [Ravish Kumar Singh v. Mani Ply, 2026-juristway.com-3215-GSTAT(Lucknow)-GST].

A vehicle carrying shuttering plywood from Mani Ply, Raebareli, to a Lucknow buyer was intercepted on 18 Jul 2023. The invoice and e-way bill covered 418 pieces, but physical verification found 450. A penalty of ₹57,870 was imposed on the basis of the value of the entire consignment, ₹1,60,748.

The first appellate authority valued the 32 excess pieces at about ₹11,431 and confined the penalty to them. The Department sought restoration of the original penalty, arguing that the excess goods showed an intention to evade tax and that Section 129 does not require separate proof of such intention.

The Bench held that the existence of excess goods “does not automatically establish that the entire consignment was being transported without valid statutory documents.” The Department had brought no material to show that the 418 documented pieces moved without valid documents, that the documents were false or fabricated, or that the declared transaction was fictitious.

While accepting that Section 129 may apply on proof of a contravention without separate proof of dishonest intention in every case, the Bench said deliberate evasion cannot be presumed against the whole consignment without a factual foundation. It noted that the first appellate authority had not absolved the taxpayer, but had only corrected the basis on which the penalty was calculated. Order-in-Appeal No. 74 dated 28 Jun 2024 was upheld and confirmed.

2026-juristway.com-3215-GSTAT(Lucknow)-GST