GST Pre-deposit through Personal Ledger Account Held Valid: Allahabad HC Follows Madras HC Ruling in Ford India Case [Read Order]

The Allahabad High Court has held that a pre-deposit made through a Personal Ledger Account for the purpose of filing an appeal under the GST ( Goods and Services Tax ) Act is valid and cannot be rejected merely on procedural grounds.

The Court relied on the Madras High Court’s ruling in the case of M/s. Ford India Pvt. Ltd. v. The Office of the Joint Commissioner (ST), GST and Another to reach its conclusion.

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The petitioner, M/S Vinod Auto Sales had filed a writ challenging the rejection of its appeal by the appellate authority on the ground that the mandatory pre-deposit under Section 107(6)(b) of the CGST Act had not been made.

The petitioner clarified that the pre-deposit amount had indeed been paid at the time of filing the appeal, but it was debited from the personal ledger account, which the authorities did not recognize as a valid mode of payment for the statutory pre-deposit.

During the hearing, the court noted that the issue had already been conclusively dealt with by the Madras High Court in Ford India, where it was held that a pre-deposit made through the Electronic Credit System (ECS) is valid and in compliance with Section 107(6)(b) of GST Act.

Adv. Dipak Seth, the Counsel for the GST Department did not dispute this legal position.

Justice Pankaj Bhatia, noting the precedent and finding merit in the petitioner’s case, the Allahabad High Court quashed the impugned orders dated 26.11.2024 and 31.01.2025, and remanded the matter back to the appellate authority for reconsideration.

The Court directed the authority to hear the appeal on merits and dispose of it expeditiously in accordance with law.

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