Taxpayer Paid Rs. 1.8 Lakh Without Specifying Purpose: Calcutta HC Directs CGST to Treat it as Statutory Pre-Deposit in Service Tax Appeal [Read Order]
The High Court held that Rs. 1.8 lakh already deposited with CGST without specifying purpose must be treated as statutory pre-deposit under Section 35F for maintaining a service tax appeal.
![Taxpayer Paid Rs. 1.8 Lakh Without Specifying Purpose: Calcutta HC Directs CGST to Treat it as Statutory Pre-Deposit in Service Tax Appeal [Read Order]](https://images.taxscan.in/h-upload/2026/03/02/2127607-calcutta-hc-directs-cgst-treat-statutory-pre-deposit-service-tax-appeal-taxscan.webp "Taxpayer Paid Rs. 1.8 Lakh Without Specifying Purpose: Calcutta HC Directs CGST to Treat it as Statutory Pre-Deposit in Service Tax Appeal [Read Order]")
In a recent ruling, the Calcutta High Court held that if a taxpayer has already paid Rs. 1.8 lakh to the CGST department without mentioning the purpose, and the amount is not adjusted against any demand, it should be treated as statutory pre-deposit for maintaining a service tax appeal. The petitioner, Samrat Chatterjee, challenged the order passed by the Appellate Authority...
In a recent ruling, the Calcutta High Court held that if a taxpayer has already paid Rs. 1.8 lakh to the CGST department without mentioning the purpose, and the amount is not adjusted against any demand, it should be treated as statutory pre-deposit for maintaining a service tax appeal.
The petitioner, Samrat Chatterjee, challenged the order passed by the Appellate Authority under Section 85 of the Finance Act, 1994 read with Section 35F ofthe Central Excise Act, 1944. His appeal against the Order-in-Original dated 18 April 2024 was rejected only because he had not complied with the pre-deposit condition.
Before the High Court, the petitioner argued that he had already deposited Rs. 1,52,046 and Rs. 28,844 in September 2017, total Rs. 1,80,890, with the CGST authorities. He said this amount was lying with the department and should be treated as compliance of the statutory pre-deposit.
The court asked the department to file an affidavit explaining for what purpose the money was deposited. The department stated that no purpose was mentioned in any document and the amount was not related to any declared outstanding liability. It also said that the reason of payment was not known to them.
After hearing both sides, the court observed that Rs. 1,80,890 was already lying with the department and was not adjusted against any demand. The court explained that since the petitioner was not otherwise liable to pay this amount, there was no difficulty in treating it as pre-deposit under Section 35F.
The court further observed that the appeal was dismissed only for non-fulfilment of pre-deposit and not on merits. In such situation, it pointed out that the amount already with the department can be treated as compliance of the requirement.
Justice Om Narayan Rai set aside the impugned order and sent the matter back to the Appellate Authority. The authority was directed to verify and treat the amount of Rs. 1,80,890, or required part of it, as statutory pre-deposit. If any shortfall is found, the petitioner will have to deposit the remaining amount within the time given. The writ petition was disposed of without costs.
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