Failure to Deposit Assessed Penalty Amount as Mandated by GST Act: Kerala HC dismisses Writ Petition [Read Order]

The Kerala High Court dismissed a writ petition due to the failure of the petitioner to deposit 20% of the assessed tax/penalty as mandated by the Goods and Services Tax ( GST ) Act and directed by the court.

The petitioner, Tikendra Singh Rithal, challenged a GST order issued by the Joint Commissioner( Appeals ) of State Goods and Service Tax Department, appealable before the Appellate Tribunal under Section 112(1) of the GST Act, 2017. According to Section 112(8)(b) of the Act, no appeal shall be filed unless the appellant pays 20% of the remaining amount of tax in dispute.

Section 112(1) of the GST Act stipulates that any person aggrieved by an order passed by the Appellate Authority under Section 107 or the Revisional Authority under Section 108 may appeal to the Appellate Tribunal. However, Section 112(8)(b) mandates the pre-deposit of 20% of the disputed tax amount before an appeal is heard. Due to the non-constitution of the Appellate Tribunal, the petitioner sought relief from the High Court.

On February 28, 2024, the court ordered the petitioner to keep his bank guarantees alive until the disposal of the writ petition, on the condition that he deposit 20% of the assessed penalty amount. The court also ordered that upon such a deposit, the bank guarantee would not be invoked and no recovery would be effected from the petitioner. On April 1, 2024, the court clarified that failure to deposit the 20% assessed penalty by April 9, 2024, would likely result in the dismissal of the writ petition.

Despite the court’s directions, the petitioner failed to deposit the required 20% of the assessed tax/penalty.

The single bench of Justice Murali Purushothaman concluded that, as the petitioner failed to comply with the statutory mandate and the court’s directions, the writ petition could not be sustained. Consequently, the writ petition was dismissed.

Harisankar V. Menon, Meera V. Menon, R. Sreejith, K. Krishna, Achyuth Menon, Parvathy Menon, and Padmanathan K.V. represented the petitioner.

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates