Tax Demand under CGST Act: Allahabad HC stays Recovery Proceeding and directs to deposit 20% Disputed Tax [Read Order]

The Allahabad High Court in a case directed the petitioner to deposit 20% of the disputed tax which was demanded under the Central Goods and Service Tax Act( CGST ),2017.

Ms. Pragya Pandey,  counsel appeared on behalf of the petitioners, and Sri Gopal Verma appeared for respondent No.2.

Counsel on behalf of the petitioners M/S. N.G. Enterprises relied upon an order passed by the coordinate bench which was in favour of the same petitioners, as in the present petition, but for different assessment year. In the order, it was held that  "In the wake of the preceding discussion, I am persuaded by the view taken by the learned single Judges of this Court in M/S Kent Cables ( supra ), M/S Tulsi Steels ( supra ) and M/S Nandan Sales Corporation ( supra ) in preference to the requirement to deposit 50% of the disputed tax liability.

The application for interim relief is finally disposed of with the following direction:

“The petitioner shall deposit 20% of the disputed tax liability in addition to the earlier deposit before the assessing authority ( which is 10% of the disputed tax amount ). Subject to the aforesaid deposit, the recovery proceedings of the balance amount shall remain stayed till the decision of this writ petition."

In light of the view taken by the coordinate bench, the single bench of Justice Shekhar B Saraf issued a similar direction.

Further directed the respondents to file a counter affidavit within four weeks; and a rejoinder affidavit, if any, within two weeks thereafter. It was directed that the petitioner shall deposit 20 per cent of the disputed tax liability in addition to the earlier deposit before the assessing authority ( which is 10% of the disputed tax liability ).

The Court further stayed the recovery proceedings of the balance amount till the Finalisation of the writ petition.

To Read the full text of the Order CLICK HERE

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