In a significant relief for taxpayers, the Jharkhand High Court has held that no further pre-deposit is required for filing an appeal before the GST Appellate Tribunal (GSTAT) when a sufficient amount has already been deposited at the first appellate stage.
The Court permitted Ranchi-based manufacturer Ashirwad Food Industries to institute its GSTAT appeal without making any additional payment, observing that the petitioner had already deposited ₹23.85 lakh during the first appeal proceedings.
Court’s Observation: Additional Deposit Not Necessary
A Division Bench comprising Chief Justice M.S. Sonak and Justice Rajesh Shankar found merit in the taxpayer’s argument and ruled:
“Considering the deposit of Rs. 23.85 lakhs already made at the first appellate stage, we agree that there would be no question of making any further pre-deposit for instituting an appeal…”
Background of the Dispute
The manufacturer challenged the appellate order dated 30 June 2025, which had partly confirmed the GST demand originally raised in the Order-in-Original dated 4 February 2025, along with applicable interest and penalty.
- Original demand: Approx. ₹2.38 crore
- Demand reduced in first appeal: Around ₹40 lakh
- Amount deposited at first appellate stage: ₹23,85,182
The petitioner argued that since 20% of the reduced demand would come to only about ₹8 lakh, the earlier deposit was more than sufficient and no fresh pre-deposit could be insisted upon for the GSTAT appeal.
Department’s Stand
The GST department contended that although GSTAT is not yet fully operational, members have been appointed and e-filing has been enabled. They assured that if the taxpayer deposited 20%, no coercive recovery steps would be taken.
However, the High Court noted that the Tribunal:
“does not appear to be fully functional.”
Appeal to Be Filed Within Four Weeks
The Bench directed the petitioner to file the appeal before GSTAT within four weeks and clarified that the Tribunal must decide the matter on merits without rejecting it on limitation grounds, since the taxpayer was bona fide pursuing the writ remedy before the High Court.
Physical Filing Permitted If E-Filing Not Accepted
The Court further ordered that if the electronic system does not accept the appeal within the prescribed period, the petitioner may file it physically, and GSTAT must accept it:
- Without insisting on any additional pre-deposit
- Without raising limitation objections
All issues on merits were kept open for adjudication before the Tribunal.
Conclusion
This ruling provides crucial clarity on GST appeal procedures, especially during the transitional phase when GSTAT is not fully functional. It reinforces that taxpayers should not be burdened with repeated deposits when the statutory requirement has already been satisfied at an earlier stage.
Case Details
- Case Title: Ashirwad Food Industries v. Union of India & Ors.
- Case Number: W.P.(T) No. 469 of 2026
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Citation: 2026 LLBiz HC(JHA)3