Case Law Details
Anukul Bindal Vs Union Of India And 3 Others (Allahabad High Court)
The Allahabad High Court considered a writ petition concerning the applicability of the amended Section 107(6) of the CGST Act, 2017, which requires a pre-deposit of 10% of the penalty amount for maintaining an appeal. The petitioner argued that the right to appeal had vested on March 31, 2023, when the show cause notice was issued, and therefore could not be altered by a subsequent amendment that came into force on October 1, 2025. It was contended that the amended requirement could not be imposed retrospectively on a vested right of appeal. The petitioner further submitted that the unamended proviso to Section 107(6) was confined to penalties under Section 129 and would not otherwise apply. Reliance was placed on the Supreme Court’s decision in Hoosein Kasam Dada (India) Limited v. State of Madhya Pradesh. The revenue opposed the plea by relying on the Supreme Court’s decision in Chandra Sekhar Jha v. Union of India and a coordinate bench decision in M/s Ganesh Yadav v. Union of India. The High Court observed that the petitioner’s submissions appeared to be covered by the principles laid down in Hoosein Kasam Dada and found that the matter required consideration. The Court granted the revenue four weeks to file a counter affidavit and two weeks thereafter to the petitioner for a rejoinder. As an interim measure, the Court directed that if the petitioner files the appeal within two weeks, it shall be entertained without requiring the 10% pre-deposit, while noting that the Court retains jurisdiction to grant waiver in appropriate cases.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Shri Praveen Kumar, learned counsel for the petitioner; Shri Krishna Agarwal, learned counsel for the revenue and, Shri Gopal Verma, learned counsel for GSTN.
2. Submission is, the right of the appeal vested on the petitioner from the date of issuance of the show cause notice 31.03.2023. Though an adjudication order was passed on 01.10.2025 and the provision of Section 107 of the CGST Act 2017, requiring a pre-deposit of 10% of the penalty amount to maintain an appeal, was enforced with effect from 01.10.2025, the right of appeal that vested in the petitioner from before cannot be altered by virtue of the amendment made. Thus, the revenue and the appeal authorities cannot compel the petitioner to deposit 10% of the disputed amount of penalty to maintain the appeal. Also, it cannot be doubted, the unamended proviso to sub-section (6) of Section 107 of the said Act, may never be applied as that was confined to penalties under Section 129 of the said Act.
3. Reliance has been placed on the decision of the Supreme Court in Hoosein Kasam Dada (India) Limited vs State of Madhya Pradesh & Ors., (1953) 1 SCC 299.
4. On the other hand, learned counsel for the revenue submits, in view of the subsequent decision of the Supreme Court in Chandra Sekhar Jha vs Union of India & Anr., Civil Appeal No(s). 1566 of 2022, decided on 28.02.2022 and another decision of a coordinate bench of this Court in M/s Ganesh Yadav vs Union of India & Ors., (2015) 6 ADJ 250, the petitioner is required to make deposit.
5. Matter requires consideration.
6. To the extent submissions being advanced learned counsel for the petitioner may be clearly covered by parent law in Hoosein Kasam Dada (supra) and further to the extent the Chandra Sekhar Jha (supra) may apply for the purpose of grant stay by the appellate authority, at present, the writ petition is being entertained.
7. Learned counsel for the revenue prays for and is granted four weeks time to file counter affidavit. Petitioner shall have two weeks thereafter to file rejoinder affidavit.
8. List thereafter.
9. In view of the further reasoning in M/s Ganesh Yadav (supra), the Court retains its jurisdiction to grant waiver in appropriate cases. By way of an interim measure, it is provided, if the petitioner’s appeal is filed within a period of two weeks from today, the same may be entertained without requirement of 10% pre-deposit.
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