The Patna High Court has allowed consideration of appeal on merits which was rejected by the appellate authority on the ground that Mandatory 10% pre-deposit has been paid by utilising the electronic credit ledger.
The bench of Chief Justice K. Vinod Chandran and Justice Partha Sarthy fave relief to the petitioner in view of stay of interim stay of the judgement of Division Bench of Patna Court in M/s Flipkart Internet Pvt. Ltd. v. The State of Bihar & Ors., by the Supreme Court in Special Leave to Appeal (C) No. 25437 of 2023.
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Background
The issue raised in the above writ petition is as to whether on filing an appeal the ten per cent of the due amounts are to be paid from the Electronic Cash Ledger or the Electronic Credit Ledger.
The petitioner paid the ten per cent amount from the Electronic Credit Ledger. The Appellate Authority by order dated 14.01.2023 rejected the appeal on the ground that the ten per cent has to be paid from the Electronic Cash Ledger.
In fact, the position has been accepted after going into the various provisions of the Goods and Services Tax Act, 2017 by a Division Bench of this Court in M/s Flipkart Internet Pvt. Ltd. v. The State of Bihar & Ors.(CWJC No. 1848 of 2023 & anrlogous cases), decided on 19.09.2023. However, observations of the judgment have been stayed on 04.12.2023 by the Supreme Court in Special Leave to Appeal (C) No. 25437 of 2023.
Notification No. 53/2023 dated 02.11.2023 issued by the Ministry of Finance, Department of Revenue (Central Board of Indirect Taxes and Customs), which permitted filing of delayed appeals even beyond the period provided under Section 107 of the GST Act, that the stipulation was of paying an amount of 12.5 per cent of the amounts pending and due to be paid to the Department as against the 10 per cent prescribed by the statute.
In the Notification issued by the Central Government on the recommendation of the GST Council, it has been specifically stated that at least 20 per cent of the 12.5 per cent remaining due and payable should be paid from the Electronic Cash Ledger. Hence, even the GST Council understood the ten per cent to be enabled for payment through the Electronic Credit Ledger.
Conclusion – Mandatory 10% Pre-Deposit
The court held that the Commissioner, Commercial Taxes, Patna shall issue necessary directions for consideration of appeals when the subject matter is pending before the Supreme Court. There shall be no insistence for payment of the 10 per cent due and payable under Section 107 of the GST Act, from the Electronic Cash Ledger.
The court held that already ten per cent of the amount remaining due and payable is remitted from the Electronic Credit Ledger which would make the appeal maintainable and the Appellate Authority shall consider it on merits.
Case Details
Case Title: M/s Raiyan Traders v/s The State of Bihar
Case No.: Civil Writ Jurisdiction Case No.12695 of 2024
Date: 28-08-2024
Counsel For Petitioner: Gautam Kumar Kejriwal
Counsel For Respondent: Aditya Raman
