SC Allows GST Appeal Without Pre-Deposit as Amendment Came After Appealable Order

M.M. Traders Vs State of U.P. & Ors. (Supreme Court of India)

The matter before the Supreme Court arose from the petitioner’s contention that an appealable order had been passed on January 1, 2025, whereas the amendment introducing a pre-deposit requirement for filing a further appeal came into force only on October 1, 2025. The petitioner argued that the subsequently introduced condition of pre-deposit could not operate as a pre-condition for maintaining the appeal in the present case. Considering the submissions advanced on behalf of the petitioner, the Supreme Court issued notice both on the application seeking condonation of delay and on the Special Leave Petition, making the matter returnable on August 14, 2026. Pending consideration of the Special Leave Petition, the Court permitted the petitioner to file the appeal and directed that the appeal be entertained without insisting upon any pre-deposit. However, the Supreme Court clarified that this interim arrangement would remain subject to the final outcome of the Special Leave Petition.

The proceedings before the Allahabad High Court had originated at a stage when the GST Appellate Tribunal under Section 112 of the GST Act had not yet been constituted, thereby depriving litigants of the statutory appellate remedy against orders passed under Sections 107 or 108 of the GST Act. Subsequently, the Central Government constituted the GST Appellate Tribunal through an order dated September 24, 2025, and appointed its Members through Office Order No. 03/2025 dated December 26, 2025, with directions to assume charge at their respective Benches by January 21, 2026. The Central Government had also notified rules regulating the procedure and functioning of the Tribunal under Section 111 of the GST Act. Observing that the constitution of the Tribunal and appointment of its Members demonstrated that the functioning of the appellate mechanism had been set in motion, the High Court concluded that no useful purpose would be served by continuing the writ proceedings. Without adjudicating upon the validity or legality of the impugned orders, the High Court permitted the petitioner to file an appeal before the GST Appellate Tribunal up to June 30, 2026, directing that such appeals be entertained without objection on the ground of limitation. The Court further directed that any amount deposited pursuant to interim orders passed during the writ proceedings would be treated as compliance with the pre-deposit requirement under Section 112(8), subject to production of the requisite proof. It also prescribed timelines for notification and rectification of defects in the appeal and clarified that the appeal would be decided on its own merits in accordance with law.