GST Pre-Deposit Must Be Computed Only on Disputed Tax, Not on Admitted Liability: Calcutta HC Directs Fresh Decision on Pre-Deposit [Read Order]
The Court set aside the appellate authority’s dismissal for a 27-day delay and alleged non-fulfilment of the mandatory pre-deposit
Calcutta High Court, Pre-Deposit, Calcutta HC Directs, Computed Only on Disputed Tax
Calcutta High Court, Pre-Deposit, Calcutta HC Directs, Computed Only on Disputed Tax
The Calcutta High Court held that a marginal delay in filing a Goods and Services Tax appeal warranted condonation, noting that the delay was satisfactorily explained and directed the authority to freshly determine whether the pre-deposit requirement under the Central Goods and Services Tax Act, 2017 had been correctly computed and complied with.
The Petitioner, Dhananjoy De challenged the order passed under Section 107 of the Central Goods and Services Tax Act, 2017 by the appellate authority. The appeal arose from an order passed under Section 74 of the same Act.
The appellate authority in the order dismissed the appeal on two grounds, firstly that it was filed 27 days beyond the three-month statutory period, and secondly, that the petitioner had not deposited the mandatory pre-deposit.
Represented by Sandip Chorasia, the petitioner argued that the delay of 27 days resulted from severe rheumatoid arthritis, which debilitated him and prevented timely filing. It was submitted that the delay was well within the condonable one-month period permitted under Section 107(4) of the Central Goods and Services Tax Act, 2017.
Further, the total demand was ₹26,31,154, only ₹21,53,505 was disputed and the admitted portion had already been paid, thus, the mandatory pre-deposit should have been calculated on the disputed amount alone.
The bench of Justice Om Narayan Rai held that the explanation for the 27 day delay was reasonable, medically substantiated, and did not indicate negligence or disregard of statutory timelines. The Court ruled that the delay was marginal and squarely within the scope of condonation provided by statute.
Regarding the pre-deposit, the Court noted that although the petitioner’s contention appeared prima facie acceptable, the matter required fresh evaluation by the appellate authority. Thus, the authority was directed to re-examine the calculation of the disputed tax, determine the pre-deposit strictly in accordance with law, and then proceed to hear the appeal on its merits only after reaching a clear finding on whether the statutory requirement had been fulfilled.
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