2025 (3) TMI 486 - HC - GST

Challenge to order passed by the appellate authority under Section 107 of the Central/West Bengal Goods and Services Tax Act 2017 - HELD THAT - Since the entire amount of tax on account of WBGST has been recovered from the petitioner there is no question for the petitioner to make further deposit of 2.5%. Paragraph 3 of the scheme dated 2nd November 2023 enables the registered tax payer to prefer an appeal beyond the ordinary time prescribed subject to the registered tax payer fulfilling the pre-condition for maintaining such appeal. Admittedly in this case the appellate authority has come to a finding that the petitioner fulfils all other precondition for maintaining the appeal save and except making payment of 2.5% of the disputed tax in respect of the WBGST by debiting his electronic cash ledger. Admittedly in this case since the entire amount of the demand on account of tax insofar as WBGST is concerned as would appear from the order impugned had already recovered the same obviously constitute 50% of the entire demand made in GSTDRC 07 forming subject matter of challenge in the appeal. The matter is remanded back to the appellate authority for a decision on merits - Petition disposed off by way of remand.

Summary

The issues presented and considered in the judgment are as follows:1. Whether the petitioner's appeal, challenging the order passed by the appellate authority under Section 107 of the Central/West Bengal Goods and Services Tax Act, 2017, should be allowed despite the petitioner's failure to pay the required pre-deposit amount of 2.5% of the disputed tax by debiting the electronic cash ledger.Issue-Wise Detailed Analysis:The court considered the relevant legal framework under the Central/West Bengal Goods and Services Tax Act, 2017, particularly Section 107 and Section 74, which govern the appellate process and pre-deposit requirements for filing appeals. The court noted that the petitioner did not take any steps after the final assessment and only filed an appeal to take advantage of a scheme allowing time-barred appeals to be filed under certain conditions.The court interpreted the scheme notified on 2nd November, 2023, which required the payment of a pre-deposit amount of 2.5% of the disputed tax by debiting the electronic cash ledger. The court found that the petitioner did not fulfill this requirement, leading to the rejection of the appeal as barred by limitation. However, the court considered the arguments presented by both parties regarding the payment of the disputed tax amount.Key evidence and findings included the acknowledgment by the State respondents that the entire amount of tax subject to the appeal had already been realized from the petitioner. The court analyzed the scheme's provisions and the petitioner's compliance with the pre-deposit requirement.The court concluded that since the entire amount of tax on account of WBGST had been recovered from the petitioner, there was no need for further deposit of 2.5%. The court emphasized that the petitioner had fulfilled all other preconditions for maintaining the appeal and remanded the matter back to the appellate authority for a decision on merits.Significant Holdings:The court held that the order dated 28th June, 2024, was set aside, and the matter was remanded back to the appellate authority for a decision on merits. The core principle established was that the fulfillment of preconditions for maintaining an appeal, including the payment of a pre-deposit amount, should be considered in light of the total tax amount already recovered from the taxpayer.In conclusion, the court disposed of the writ petition with the direction to provide an urgent certified copy of the order to the parties upon compliance with formalities.