GSTAT to Consider Admission of Penalty Appeal Without Pre-Deposit, Issues Notice to Revenue

Hero Wiretex Limited Vs Commissioner Appeals (GSTAT)

The GST Appellate Tribunal, Hyderabad Bench in Hero Wiretex Limited v. Commissioner (Appeals), Hyderabad Zone & Ors., issued notice to the Revenue in an appeal challenging penalties imposed under Sections 122(1)(ii) and 122(1)(vii) of the CGST Act where the Registry had raised a defect for non-payment of statutory pre-deposit. The appellant contended that no pre-deposit was payable as the impugned order was passed prior to 01.10.2025, when pre-deposit for penalty-only appeals became mandatory, that the amendment did not operate retrospectively, and that the adjudication was without jurisdiction as the proper officer had not been appointed to issue the show cause notice or adjudicate the matter. The Departmental Representative accepted notice on behalf of the respondents. The Tribunal stated that it was not inclined to examine the merits at that stage and observed that the appeal could be considered for admission based on the respondents’ submissions. It directed the Registry to issue notice to the respondents to file counter affidavits within four weeks and ordered that the matter be listed thereafter for consideration of admission.

Facts:

Hero Wiretex Limited (“the Appellant”) was subjected to penalties simpliciter under Section 122(1)(ii) [issuance of any invoice or bill without supply of goods or services] and Section 122(1)(vii) [taking or utilising input tax credit without actual receipt of goods or services] of the CGST Act, in respect of the Financial Years 2017-18 and 2018-19. Aggrieved by the order passed by the Commissioner (Appeals), Hyderabad Zone (“the Respondent”), the Appellant preferred a second appeal before the GST Appellate Tribunal, Hyderabad Bench.