The GST Appellate Tribunal (GSTAT), Odisha has held that an assessee may not be required to make a fresh pre-deposit under Section 112(8) of the CGST/OGST Act where the amount already deposited at the first appellate stage is equal to or exceeds the prescribed percentage of the tax liability that remains in dispute after the demand is substantially reduced by the Appellate Authority.

The Bench of Suchismita Misra (Judicial Member) and Ranjan Kumar Sahoo (Technical Member)  has upheld the finding that the assessee was not required to make any further pre-deposit for pursuing the appeal before GSTAT under Section 112(8) of the CGST/OGST Act in the facts of the case. 

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The controversy arose from an earlier order dated July 8, 2026, by which the Tribunal had admitted the assessee’s appeal without requiring any further pre-deposit under Section 112(8)(b) of the CGST Act.

The Respondent-Petitioner sought recall or modification of that finding, arguing that the Tribunal had determined the issue concerning the mandatory pre-deposit without providing the Respondent an opportunity of being heard. It specifically requested reconsideration of the interpretation of Section 112(8)(b), particularly the words requiring payment of 10% of the remaining tax in dispute “in addition to” the amount paid under Section 107(6). 

The Respondent also sought clarification that the earlier order should not be treated as laying down a general proposition that a pre-deposit made under Section 107(6) could automatically be adjusted against the statutory pre-deposit contemplated under Section 112(8)(b). 

The Tribunal noted that when the appeal had initially been listed for admission with registry defects, the Respondent had not been notified to appear.

The defects identified by the Registry included short-payment of court fees and non-payment of the pre-deposit contemplated under Section 112(8)(b) of the CGST Act. 

At the July 8 hearing, the assessee agreed to comply with the court-fee requirement but argued that no additional pre-deposit was necessary because the amount already deposited before the Appellate Authority exceeded the amount required for pursuing the appeal before the Tribunal.

The assessee relied upon the Jharkhand High Court’s decision in M/s Ashirwad Food Industries v. Union of India. Accepting the submission in the circumstances of the case, the Tribunal admitted the appeal and directed issuance of notice to the Respondent for filing cross-objections. 

The Tribunal examined the statutory scheme governing pre-deposits at the two appellate stages.

Section 107(6) requires an appellant to pay the admitted amount of tax, interest, fine, fee and penalty and a sum equal to 10% of the remaining amount of tax in dispute, subject to the prescribed monetary ceiling.

Section 112(8), dealing with appeals before the Tribunal, similarly requires payment of the admitted liability and 10% of the remaining amount of tax in dispute, in addition to the amount paid under Section 107(6), subject to the statutory ceiling. 

The Respondent argued that the language of Section 112(8) clearly required a separate additional deposit and that the amount deposited under Section 107(6) could not be adjusted against the amount payable for an appeal before GSTAT.

For this proposition, reliance was placed on an Orissa High Court order dated November 27, 2025 in Abhijit Nayak v. Commissioner of CT & GST, Odisha. The Tribunal, however, found the factual circumstances of that case distinguishable from the matter before it. 

The Tribunal framed the central issue around a situation where an assessee has already made the prescribed pre-deposit while filing an appeal before the first Appellate Authority, but the disputed tax demand is subsequently substantially reduced.

The question was whether the assessee must again deposit 10% of the surviving disputed tax while approaching the Tribunal when the amount already deposited at the first appellate stage is equal to or greater than the prescribed percentage of the reduced tax liability. 

The Bench observed that the problem would not arise in the same manner if the original demand remained intact after the first appeal. In such circumstances, Sections 107(6) and 112(8) would operate in the ordinary manner.

However, the Tribunal considered a different situation where the demand had been substantially reduced by the Appellate Authority. It also considered the example of an assessee who had already paid the entire disputed tax under protest and then pursued the appellate remedy. 

A significant observation of the Tribunal was that the pre-deposit is not a payment towards a separate or independent liability.

The Bench observed that the pre-deposit represents a specified portion of the disputed tax itself, which an assessee is required to pay for pursuing an appeal under Section 107(6). Consequently, the statutory requirement cannot necessarily be applied mechanically in every factual situation without considering the amount already deposited and the reduction in the tax liability. 

Applying this reasoning to the case, the Tribunal noted that the assessee had deposited ₹1,13,448 under Section 107(6) against an original disputed tax liability of ₹11,34,474.

The Appellate Authority subsequently reduced the disputed tax liability to only ₹1,02,012. The assessee thereafter approached GSTAT challenging the reduced tax liability. 

Thus, the amount already deposited at the first appellate stage was higher than the surviving disputed tax liability itself.

The Tribunal held that where the amount already deposited is equivalent to or exceeds the aggregate percentage required with reference to the tax remaining in dispute, insisting upon another deposit would not be justified in the circumstances under consideration. 

The Tribunal also considered the decision of the Jharkhand High Court in M/s Ashirwad Food Industries v. Union of India, which it found to involve facts identical to the pre-deposit issue arising before it.

In that case, the assessee had deposited approximately ₹23.85 lakh at the first appellate stage against an original demand of around ₹2.38 crore. The first Appellate Authority subsequently reduced the demand to approximately ₹40 lakh. The High Court held that, considering the pre-deposit already made, there was no question of requiring a further pre-deposit for instituting the appeal against the reduced demand. 

The GSTAT considered the High Court’s observations directly relevant to the issue before it and noted that they carried persuasive value, particularly since the matter concerned the same central legislation. 

After considering the statutory provisions, the factual circumstances and the judicial precedent, the Tribunal found no ground to interfere with its earlier order dated July 8, 2026.

The interim application was accordingly disposed of, with no order as to costs. The order was signed by Member (Technical) Ranjan Kumar Sahoo and Member (Judicial) Suchismita Misra and dated September 21, 2026. 

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