High Court · 2025

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a writ or order or more in direction or Writ of lrlandamus and call for the records pertaining to the issued impugned Order in Appeal No. HYD-GST- RRC-APP1-COIVMR-032-25-26 dated 26.08.2025 issued by the 1st Respondent and set-aside the same. lA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay the operation of the is:;ued impugned Order in Appeal No. HYD-GST-RRC-APP1- COMMR-032-25-26 daled 26.08.2025 by the 1st Respondenl till the disposal of the present Writ Petiticn. Counsel for the Petitioner : SRI MADANU NARESH Counsel for the Respondents :SRl OOMINIC FERNANDES, Sr.SC FOR CBIC The Court made the following: ORDER THE HON'BLE THE CHIEF JUSTICE SRI APARF^SH KUMAR SINGH THE HON'BLE SRI JUSTICE G.M.MOHIUDDIN AND 1VRIT PETITION No.32616 of 2O25 ORDER: Learned counsel Sri S.Durairaj, representing learned counsel Sri Madanu Naresh, appears for the petitioner. Sri Dominic Fernandes, learned Senior Standing Counsel for Central Board of Indirect Taxes and Customs, appears for the respondents.

2. The order-in-appeal dated 26.O8.2025 is under challenge. The appellate authority has refused to interfere in the order-in-original imposing penalty upon the petitioner.

3. During the course of hearing, it has been brought to the notice of this Court that the Goods and Services Tax Appellate Tribunal (hereinafter referred to oS, "the Appellatc Tribunal") has started functioning. I I 1

4. Scction ll2 of the Central Goods and St:rvices Tax Act, 2017 (hereinafter referred to as, "the Act"), provides for appeal to the Appellate Tribunal. The Appellate Tribunal has issued an order dated 24.09.2025 under Rule 123 ol the Goods ancl Serrrices Tax Appellate Tribunal (Procedure) Rules, 2025, classifying the category of cases specified in column (2) of the table appended thereto and the period during r,r'hich the appeal under Section 112 of the Act would be fiir:d before the Appellate Tribunal corresponding to the period during which the orders of tht: appellate authority were Passed.

5. In the present case, since the impugnecl order-in- appeal is date'd 26.08.2025, the window lor liling such appeal is prescribed at serial No.S i.e., commencing on

01.02.2026 or any date succeeding such date being not later tha:e 30.06.2026. It is further brought to the notice of this Court that the Finance Act,2025, notified on \

29.03.2025, hirs amended Section ll2 of th(: Act and- / added the pror.iso to sub-section (B) thereto, which reads as under - "13O. In section 112 of the Central Goods and Services Tax Act, in sub-secLion (8), the following proviso shali be inserted, namely:- "Provided that in case of any order demanding penalty without involving demand of any tax, no appeal shall be filed against such order unless a sum equal to ten per cent of the said penalty, in addition to the amount payable under the proviso to sub section (6) of section 107 has been paid by the appellant.""

6. This Court has, in similar circumstances, relegated the aggrieved petitioner to prefer AI appeal before the Appellate Tribunal within a timeframe. It has also been ordered that subject to deposit of 1O% of the tax liability within the aforesaid time, no coercive action be taken against the petitioner therein till the decision of the Appeliate Tribunal in the said appeal. 7 . In the instant case, there is no imposition of tax liability. But, the liability of penalty has been imposed. Under the amended proviso to Section ll2 of the Act, the aggrieved person has to deposit a sum equal to 10% of the penalty in addition to the amount payable under the I I proviso to sub-section (6) of Section lO7 of the Act paid by \ the appeilant. -+

8. Learned counsel for the petitioner submits that since the penalty is of substantial amount, the petitioner may be permitted to make 10% deposit of the penalty amount within a peri,rd of eight weeks. He also submits that certain amount, if any, deposited by the firm of the petitioner as tax liability in Form GST DRC-03 during the investigation rnay be permitted to be deductecl from the lOnh of the penalty amount to be deposited as a condition of pre-deposit lbr preferring the appeal.

9. To the raforesaid submission, the learned Senior Standing Counsel for Central Board of Indirect Taxes and Customs appearing for the respondents has taken objection. He submits that the amount, if any, paid by the firm of the petitioner as per Form GST DRC-03 is towards the tax liability'. The order-in-original as affirmed by the impugned order-in-appeal only imposes penalty. \ Therefore, the petitioner cannot take the benelit of making any deposit or payments towards tax liability during the investigation proceedings. I )

10. Upon consideration of the rival submissions of the parties, in the facts and circumstances noted above, the \ writ petition is disposed ol without expressing any opinion on the merits of the case and by giving liberty to the petitioner to prefer an appeal before the Appellate Tribunal within the window period prescribed under the order dated

24.O9.2025 issued by the Appellate Tribunal. The petitioner shall deposit lOo/o of the penalty amount within a period of eight r,r,eeks from today. If the petitioner makes such pre-deposit within the aforesaid period, no coercive action be taken against the petitioner till the decision of the Appellate Tribunal in the appeal to be filed. We, however, do not accept the contention of the petitioner that the amount, if any, paid by the firm of the petitioner towards the tax liability during investigation can be adjusted as against pre-deposit to be made for the purposes of preferring the appea-l before the Appellate Tribuna-l. However, there shall be no order as to costs. .-- 6 Miscellaneous applications pending, if any, shall stand closed. S AS .BHAVANI SWAMY TANT REGISTRAR / //TRUE COPYII SECTION OFFICER To,

1. The Commissioner of Customs and Central Tax, Office of the Commissioner of Customs and Central Tax, Appeals I Commissionerate 7th Floor, GST Bhavan, L.B. Stadium Road, Basheerbagh, Hyderabad - 500 004.

2. The Additional Commissioner of Central Tax, Rangareddy GST Commissionerate, GST Bhavan, H. No.1-98/7i43, VIP Hills, Jaihind Enclave, tVladhapur, Hyderabad-500 01 6.

3. The Additional Director of DGGI, Vishakapattnam Zonal Unit, D. No. 2B-14- 17, Suryabagh, Besides MelodyTheatre, Vishakapatnam 530 020.

4. The Additional Director of DGGI, Hyderabad Zonal Unit, H. No. 1-1 1-22214, Lane Opp. HDFC Bank, Hyderabad - 500 016.

5. One CC to SRI N4ADANU NARESH, Advocate. [OPUC] 6. One CC to SRI DOMINIC FERNANDES, Senior Standing Counsel for CBIC. loPUCl

7. Two CD Copies. BSK I I HIGH COURT DATED:291101i1025 ORDER WP.No.32616 of 2025 c3 1t'lE S I4 r€ k Llr C ) I Ir ./' 01 l,l[tJ 2925 OATC 'i?-t) 1i l! DISPOSING OF THE WRIT PETITION WITHOUT COSTS a, {