Page 11 - Chap21 Offences & Penalties

04. Sec 129- Detention, seizure, and release of goods and conveyances in transit

CCP 21.04.09.00
From the following details, calculate the penalty to be paid, for release of goods detained or seized
u/s 129 of CGST Act, 2017, if owner of the goods does not come forward for payment of applicable
penalty. Details are as follows:-

Particulars Amount (₹)
Value of goods 30,00,000
Applicable GSTon such goods 5,40,000
GST already paid on such goods 3,60,000

Would your answer be different, if goods were exempted from GST and value remains the same
namely ` 30,00,000? [CA Final Exam May 19-Old]
Answer:- Legal Provision:-
Ü As per section 129(1)(b) of CGST Act, if the owner of goods does not come forward for the payment
of penalty, detained/seized goods and conveyance (used as a means of transport for carrying said

goods) and related documents are released on payment of penalty equal to higher of following:-
Ø 50% of the value of goods or
Ø 200% of the tax payable on such goods.
Ü However, for exempted goods, amount payable for release of goods detained shall be lesser of:-

Ø 5% of the value of goods or ` 25,000.
Discussion & Conclusion:-
Ü The Penalty payable for release of goods detained or seized is ` 15,00,000 which is the higher of:-
Ø (50% X `30,00,000) =` 15,00,000 or

Ø (200% X `5,40,000) =` 10,80,000.
Ü If goods are exempted from GST, then the amount payable for release of goods detained shall be
` 25,000 which is the lesser of:-
Ø 5% X ` 30,00,000 = ` 1,50,000 or ` 25,000.

CCP 21.04.10.00
Comet Chem of Ahmedabad handed over goods to transporter Ram Roadways to carry the same

from Ahmedabad to Bharuch in Gujarat. The value of the goods is ₹ 80,000 which is chargeable to
tax @ 18% GST (9% SGST + 9% CGST) and in transit, proper officer intercepted the vehicle under
section 68 of CGST Act and seized the goods.

Calculate the penalty payable under section 129 of CGST Act, 2017 for release of the goods:
Ü If Comet Chem, owner of goods, comes forward for payment of penalty.
Ü If Comet Chem, owner of goods, does not come forward for payment of penalty. [CA Final Nov
22 Exam][CA Final May 19 Exam New (Similar)]
Answer :

Legal Provision:-
Ü The penalty payable under section 129(1) of CGST Act, 2017 is:-
a) 200% of the tax payable on goods detained or seized, if the owner of goods comes forward for
payment of penalty,

b) Higher of 50% of the value of goods or 200% of the tax payable on goods detained or seized, if
the owner of goods does not come forward for payment of penalty.

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