Case Law Details
Kiran Motors Vs Addl. Commissioner of CT & GST (Orissa High Court)
In the case of M/s. Kiran Motors v. Addl. Commissioner of CT & GST [W.P (C) No.22817 of 2023, dated August 10, 2023], the Hon’ble Orissa High Court overturned the order rejecting the appeal by the 1st Appellate Authority. The Court concluded that a pre-deposit for GST can be accomplished using the Electronic Credit Ledger (ECL).
Facts:
M/s. Kiran Motors (“the Petitioner”) field first appeal before the 1st Appellate Authority who vide order dated March 31, 2023 (“Impugned Order”) rejected the appeal as the pre-deposit of 10% of admitted tax amount was debited through the ECL.
Aggrieved by the Impugned Order the Petitioner filed a writ before the Hon’ble Orrisa High Court and contended that the CBIC vide circular dated July 06, 2022 clarified that payment of pre-deposit can be made by using the ECL.
Issue:
Whether pre-deposit under GST can be done through E-Credit Ledger Instead of the ECL?
Held:
The Hon’ble Orrisa High Court W.P (C) No.22817 of 2023 held as under:
- Noted that, CBIC vide circular dated July 06, 2022 clarified that payment of pre-deposit can be made by using the ECL.
- Opined that, the Petitioner has already made the pre-deposit using the ECL, that will now be accepted by the Revenue Department.
- Set aside the Impugned Order, and listed the matter before the 1st Appellate Authority on September 11, 2023.
Conclusion: The ruling by the Orissa High Court in the Kiran Motors vs. Addl. Commissioner case has brought clarity on the usage of the ECL for pre-deposits under GST. The validation of the CBIC’s previous circular on the matter reiterates the importance of the consistent application of rules and guidelines across various appellate authorities. This judgment not only benefits the petitioner but also sets a precedent for similar cases in the future.
FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT
1. This matter is taken up through hybrid mode.
2. The short ground on which the Petitioner is seeking the setting aside of the order dated 3 1.03.2023 passed by the Addl. Commissioner of CT & GST is that the appellate authority rejected the appeal as the pre-deposit of 10% of admitted tax amount was debited through the Electronic Credit Ledger (ECL) instead of Electronic Cash Ledger.
3. It is seen that by circular dated 6th July 2022 issued by the GST Policy Wing, Central Board of Indirect Taxes and Customs, Department of Revenue, Ministry of Finance, Government of India, it has been clarified that payment of pre-deposit can be made by using the ECL.
4. In that view of the matter, the impugned order dated 31.03.2023 is set aside. As the learned counsel for the Petitioner points out that the Petitioner has already made the pre-deposit using the ECL, that will now be accepted by the Department. The appeal will now be listed before the 1st appellate authority i.e., the Additional Commissioner of CT & GST on 11th September, 2023. The Petitioner will appear on that date before the appellate authority along with a downloaded copy of this order. The appeal thereafter be disposed of afresh after hearing the Petitioner and the Department within a period of three months thereafter.
5. The writ petition is disposed of in the above terms.
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