Validity of GST Pre-Deposit made from ECRL: Allahabad HC remands Matter to Commissioner of Appeals [Read Order]

In a recent ruling, the Allahabad High Court has quashed an order passed by the Commissioner (Appeals) under the Goods and Services Tax ( GST ) Act, dismissing an appeal on the ground of non-compliance with the mandatory pre-deposit requirement. The matter has now been remanded for fresh consideration.

The petitioner had challenged the order dated 28.10.2024 passed in Appeal No. 212 of 2024, wherein the appeal was dismissed for non-deposit of the mandatory pre-deposit as stipulated under Section 107 of the CGST Act, 2017.

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The counsel for the petitioner contended that the appeal was initially admitted without any objection regarding the mode of deposit. It was only at the final stage that the appeal was dismissed on the ground that the deposit was made through the Electronic Credit Ledger (ECRL), which was allegedly not in compliance with Section 107.

The counsel for the respondents candidly conceded that if the Commissioner (Appeals) had found the deposit made through ECRL to be invalid, the petitioner ought to have been given an opportunity to respond before the appeal was dismissed on merits.

Considering the consensus between the parties, the High Court set aside the impugned order dated 28.10.2024 and remanded the matter back to the Commissioner (Appeals) for reconsideration.

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The Court directed that the issue of whether a deposit made through the ECRL qualifies as a valid pre-deposit under Section 107 of the GST Act be re-examined in light of the arguments and judicial precedents presented by both parties.

The bench concluded by disposing of the writ petition with the direction that the Commissioner (Appeals) shall pass a fresh order after granting both sides a full opportunity to be heard.

The case was heard by a bench comprising Justice Pankaj Bhatia, wherein Sri R. Krishnan, assisted by Sri Veer Bahadur Lal Srivastav and Shri Vinay Singh, appeared on behalf of the petitioner. Sri Dipak Seth represented the respondents.

To Read the full text of the Order CLICK HERE

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