Appellate Authority not to Insist Firm to make Pre-Deposit through Electronic Cash Ledger: Allahabad High Court

The Allahabad High Court has held that pre-deposit has been made by the Firm before the Appellate Authority, and the Appellate Authority shall not insist the Firm to make deposit through electronic cash ledger and shall proceed to decide the appeal on merits strictly in accordance with law.


The petitioner submitted that mandatory pre-deposit of 10% was made by the Assessee Firm through electronic credit ledger. However, the Additional Commissioner, Grade-2 (Appeal)-I, Commercial Tax, Jhansi had rejected the appeal on the ground that the mandatory deposit should have been made from the cash ledger. 

The commissioner has place reliance on the clarificatory circular, issued by Government of India, on 06.07.2022 wherein it has been clarified that any payment towards output tax, whether self-assessed in the return or payable as a consequence of any proceeding instituted under the provisions of GST Laws, can be made by utilisation of the amount available in the electronic credit ledger of a registered person.

The First Appellate Authority, solely on the ground that the compliance has not been made by depositing through electronic cash ledger, had rejected the appeal without deciding the issue on merit. Subsequently, on 25.6.2022, the petitioner Firm had made deposit through a cash ledger.

Court’s Observation

The bench of Justice Rohit Ranjan Agarwal set aside the order impugned dated 16.06.2022 passed by Additional Commissioner, Grade-2 (Appeal)-I, State Goods & Services Tax, Jhansi for the financial year 2017-18 under Section 74(9) of the Goods and Services Tax Act, 2017. The First Appellate Authority shall decide the appeal on merit within a period of one month from the date of production of a certified copy of this order.

Case title: M/S Tulsi Ram And Company v/s Commissioner

Citation: WRIT TAX No. – 1237 of 2022

Click here to read the Order/Judgment 

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