12 Apr Calcutta High Court’s Verdict on GST Pre-Deposit Requirements
Introduction:
In a recent ruling, the Calcutta High Court addressed the clarification of GST pre-deposit requirements, specifically focusing on the interpretation discrepancy between the GST Department and the GST Law.
Facts of the Case:
- A writ petition challenged an interim order dated January 25, 2024, demanding a pre-deposit of 20% of the disputed unpaid interest.
- The dispute stemmed from interest demands on belatedly filed returns for a specific financial year, with the petitioner seeking relief due to the non-constitution of the appellate tribunal.
Issue:
- The central concern was whether the petitioner must pre-deposit 20% of the disputed interest alongside the tax in dispute before filing an appeal, as indicated by the interim order.
Petitioner’s Argument:
- The petitioner argued that while the GST Act mandates a pre-deposit of 20% of the remaining tax amount in dispute, it does not explicitly extend this requirement to disputed interest.
Respondent’s Argument:
- The respondent countered, asserting that the interim order was discretionary and aimed at safeguarding revenue interests, without any procedural error.
Held:
- The Calcutta High Court overturned the portion of the order mandating the petitioner to pay 20% of the remaining interest, directing a halt to recovery proceedings until the writ petition is heard and disposed of.
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