Once Goods Are Verified And Found To Be Correct In MOV-04, Department Can't Be Permitted To Change Stand Later: Allahabad High Court

Justice Piyush Agrawal held

“Once on the verification report i.e. MOV-04, the items are fed by the officer concerned, after due verification, the authorities cannot be permitted to completely change its stand or further permitted to supplement by different reasons or grounds, which were not taken or mentioned while preparing the physical verification report in MOV-04.”

Petitioner pleaded that the goods were intercepted while being transported from Guwahati, Assam to Delhi. All documents were produced at the time of interception and the statement of the driver was also recorded. It was argued that at the time of physical verification, no difference was found between the invoice and the actual goods, and the description of the goods was noted in MOV-4.

Despite no discrepancies, penalty order was issued against the petitioner. The appeal filed by the petitioner was dismissed. Petitioner approached the High Court on grounds that the authority could not be permitted to change its stand at a later stage.

The Court observed that there was no difference between the goods and their description mentioned in the invoices and the MOV-04 and thus, the revenue could not later change its stand.

Though the counsel for department pleaded that once the HSN code as per the invoice is entered in MOV-04, the goods mentioned in the invoice will automatically appear in MOV-04, Upon specific query by the Court, he acceded that the goods had to be entered manually by the authority.

“The purpose of filling MOV-04, at the time of physical verification, is to find the correctness of the goods in transit from the accompanying documents and if the officer while preparing the MOV-04 did not find any change or difference in goods that of mentioned in the accompanying documents, the same cannot be permitted at a later stage for taking a different stand, as mentioned in the present case,” held Justice Agrawal.

The Court relied on its judgment in Jitendra Kumar Vs. State of U.P. and Another, where it was held that the revenue cannot be permitted to change the goal post at each stage, i.e., once a stand has been taken by the revenue, it must stick to it.

Accordingly, the Court allowed the writ petition.

Case Title: M/S Maa Kamakhya Trader v. Additional Commissioner Grade 2 And Another [WRIT TAX No. - 1386 of 2023]