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The GST Authority cannot detain goods in transportation for non-payment of tax by another party in the supply chain

The Hon’ble Punjab and Haryana High Court in M/s. Shiv Enterprises v. the State of Punjab and others [CWP-18392-2021 dated February 04, 2022] held that GST Authorities cannot detain goods in transportation without passing appropriate orders if goods are accompanied with the documents as prescribed and cannot proceed against the taxpayer for contravention of any provision of the Central Goods and Services Tax Act, 2017 (“the CGST Act”). Further held that it is not the liability of the taxpayer to find out whether or not any other person in the supply chain has paid the tax and is the fundamental legal principle, that the law does not compel a man to do that which he cannot possibly perform.

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