CONFISCATION :
The word ‘confiscation’ has not been defined in the Act. The concept is derived from Roman Law wherein it meant seizing or taking into the hands of emperor, and transfer to Imperial “fiscus” or Treasury. The word “confiscate” has been defined in Aiyar’s Law Lexicon as to “appropriate (private property) to the public treasury by way of penalty; to deprive of property as forfeited to the State.”
Section 70 of the Model GST Law provides for confiscation of goods in certain circumstances. Accordingly, goods shall be liable to confiscation if any person
• supplies any goods in contravention of any provision of this Act and such contravention results in evasion of tax payable under the Act, or
• does not account for any goods in the manner required under the Act, or
• supplies goods that are liable to tax under the Act without applying for registration
• contravenes any provision of the Act/Rules with the intention of evading payment of tax
The title in the confiscated goods shall vest in the Government and every Police officer to whom the proper officer makes a request in this behalf, shall assist in taking possession of the goods. The proper officer shall, after providing an opportunity of being heard by serving a notice on the owner or person in charge of the goods, shall proceed to levy penalty which shall be higher of
• The tax evaded on the confiscate goods or
• Rs.10,000
In terms of section 70(6), the Owner or the person in-charge of the goods liable to confiscation is to be given the option for fine (not exceeding market price of confiscated goods) in lieu of confiscation. This fine shall be in addition to the tax and other charges payable in respect of such goods.
Section 71 provides that any conveyance carrying goods without the cover of any documents or declaration prescribed under the Act shall be liable to confiscation. However, if the owner of the conveyance proves that the goods were being transported without cover of the required documents/declarations without his knowledge or connivance or without the knowledge or connivance of his agent then the goods shall not be liable to confiscation as aforesaid. If the conveyance is being used for carrying goods or passengers for hire then the owner of such a conveyance may be provided an option to pay a fine equivalent to the tax payable on the goods, in lieu of confiscation. Section 72 provides that the confiscation or penalty under section 70 or 71 shall be without prejudice to any other punishment/action provided in the Act for the offence of carrying goods without cover of the required documents/declaration.