{"id":9226,"date":"2026-05-24T07:46:48","date_gmt":"2026-05-24T02:16:48","guid":{"rendered":"https:\/\/www.centaxonline.com\/blog\/?p=9226"},"modified":"2026-05-24T07:46:48","modified_gmt":"2026-05-24T02:16:48","slug":"hc-quashes-section-130-confiscation-without-prior-tax-determination-under-sections-73-74","status":"publish","type":"post","link":"https:\/\/www.centaxonline.com\/blog\/hc-quashes-section-130-confiscation-without-prior-tax-determination-under-sections-73-74","title":{"rendered":"HC Quashes Section 130 Confiscation Without Prior Tax Determination Under Sections 73\/74"},"content":{"rendered":"<pre><strong>Case Details: <a href=\"https:\/\/www.centaxonline.com\/latest-news-updates\/gst\/101010000000420254\/section-130-confiscation-proceedings-quashed-for-absence-of-prior-tax-determination-under-sections-7374-hc\">KVN FMCG Pvt. Ltd. vs. State of U.P. (2026) 42 Centax 318 (All.)<\/a><\/strong><\/pre>\n<h2><em>Judiciary and Counsel Details<\/em><\/h2>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li><strong><span id=\"111170000000049942\">Shekhar B. Saraf<\/span>\u00a0<\/strong>&amp; <strong>Abdhesh Kumar Chaudhary<\/strong>, JJ.<\/li>\n<li><strong>S\/Shri Pranjal Krishna<\/strong>, <strong>Aman Prakash and Ankit Mishra<\/strong>, for the Petitioner.<\/li>\n<li><strong>C.S.C., A.S.G.I.<\/strong>, for the Respondent.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><em>Facts of the Case<\/em><\/h2>\n<p>The assessee was subjected to a search at its premises. Pursuant to the search, the department alleged excess stock and record-keeping lapses. The amount was recovered through DRC-03 during the search. A Show Cause Notice (SCN) was issued under section 130 of the CGST Act, read with section 122, proposing confiscation and levy of penalty. A confiscation order under section 130(1)(i) was passed, and DRC-07 was uploaded reflecting the demand. The assessee filed a writ challenging the jurisdiction of the confiscation action. The matter was accordingly placed before the High Court.<\/p>\n<h2><em>High Court Held<\/em><\/h2>\n<p>The High Court held that the law stood settled that action under section 130 of the CGST Act and the Uttar Pradesh GST Act could not be initiated without prior determination of tax under sections 73 or 74. It was observed that the SCN issued under section 130 read with section 122 was without such a determination; therefore, the initiation lacked jurisdiction. The SCN and the resultant confiscation order were consequently quashed. Liberty was granted to the department to proceed afresh in accordance with law under the relevant provisions. The refund claim was also left open to be pursued in accordance with the law.<\/p>\n<h2><em>List of Cases Cited<\/em><\/h2>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Additional Commissioner v. Dayal Product \u2014 [2025] 178 taxmann.com 288 (SC) = 2025 102 G.S.T.L. 193 (SC) \u2014 Referred [Para 3]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=(2026)%2038%20Centax%2027%20(S.C.)&amp;itemType=AP\">Additional Commissioner v. Dinesh Kumar Pradeep Kumar<\/a> \u2014 (2026) 38 Centax 27 (S.C.) \u2014 Referred [Para 3]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=(2026)%2038%20Centax%20286%20(S.C.)&amp;itemType=AP\">Additional Commissioner v. Shree Om Steels<\/a> \u2014 (2026) 38 Centax 286 (S.C.) \u2014 Referred [Para 3]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=(2025)%2028%20Centax%20144%20(All.)&amp;itemType=AP\">Dayal Product v. Additional Commissioner<\/a> \u2014 (2025) 28 Centax 144 (All.) = 2025 (98) G.S.T.L. 351 (All.) \u2014 Referred [Para 3]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=(2024)%2023%20Centax%2071%20(All.)&amp;itemType=AP\">Hcl Infotech Ltd. v. Commissioner, Commercial Tax<\/a> \u2014 (2024) 23 Centax 71 (All.) = 2024 (90) G.S.T.L. 233 (All.) \u2014 Referred [Para 6]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=(2023)%206%20Centax%2062%20(All.)&amp;itemType=AP\">Maa Mahamaya Alloys (P.) Ltd. v. State of U.P.<\/a> \u2014 (2023) 6 Centax 62 (All.) = 2023 (73) G.S.T.L. 612 (All.) \u2014 Referred [Para 3]<\/li>\n<li>Metenere Ltd. v. Union of India \u2014 [2020] 122 taxmann.com 36 (Allahabad) \u2014 Referred [Para 3]<\/li>\n<li>Siemens Ltd v. State of Maharashtra \u2014 (2006) 12 SCC 33 \u2014 Referred [Para 6]<\/li>\n<li>Whirlpool Corporation v. Registrar of Trade Marks \u2014 (1998) 8 SCC 1 \u2014 Referred [Para 5]<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Case Details: KVN FMCG Pvt. Ltd. vs. State of U.P. (2026) 42&hellip;<\/p>\n","protected":false},"author":19,"featured_media":9236,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37,60,189],"tags":[],"class_list":["post-9226","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-gst","category-news","category-gst-case-chronicles"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>HC Quashes Section 130 Confiscation Without Prior Tax Determination Under Sections 73\/74<\/title>\n<meta name=\"description\" content=\"HC rules Section 130 confiscation proceedings invalid without prior tax determination under Sections 73 or 74 of GST law.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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