GST Penalty Cannot Be Sustained Under Section 129(1)(b) Merely Because Registration Was Later Suspended

The petitioner, a proprietorship concern, was transporting watermelon seeds from Bihar to Delhi under a tax invoice and RR. 

The goods were intercepted in Uttar Pradesh on the ground that an e-way bill had not been tendered. 

On inquiry, the authorities proceeded on the basis that the petitioner was an unregistered dealer and consequently invoked Section 129(1)(b). The petitioner's GST registration was subsequently restored. 

The Allahabad High Court held that the existence of a tax invoice meant that the petitioner could be treated as the owner of the goods.