Ford India Private Limited Vs Joint Commissioner (ST) (Madras High Court)
In a significant judgment, the Madras High Court clarified the permissibility of using the Electronic Credit Ledger for the mandatory 10% pre-deposit required under Section 107(6) of the Tamil Nadu Goods and Services Tax (TNGST) Act, 2017, when filing an appeal. The case, Ford India Private Limited vs. Joint Commissioner (ST), brought to light the nuanced interpretation of provisions related to pre-deposit payments and their compliance through electronic ledgers.
Case Background
Ford India Private Limited, engaged in manufacturing and supplying passenger vehicles, faced a differential GST demand for discrepancies between GSTR-1 and GSTR-3B returns for the financial year 2017-2018. After a notice in Form DRC-01A and a subsequent reply by the petitioner, the authorities issued a show cause notice (SCN) in May 2023. The SCN culminated in a demand order imposing tax, interest, and penalties.
In response, Ford India filed an appeal before the GST Appellate Authority in October 2023, making the mandatory pre-deposit of ₹32,88,352 (10% of the disputed tax) through the Electronic Credit Ledger. However, the Appellate Authority issued a deficiency memo, asserting that the pre-deposit must be made via the Electronic Cash Ledger. This prompted Ford India to seek relief through a writ petition in the Madras High Court.
