2019 (1) TMI 1033 - AT - Service Tax

Tribunal allows pre-deposit with CGST Credit, directs Registry for final disposal.

The Tribunal found in favor of the appellant, ruling that the objection raised by the Registry regarding pre-deposit payment was baseless. The appellant ... Pre-deposit requirement for filing appeal - utilisation of electronic credit ledger for payment of arrears - reversal of CGST credit indicated in GSTR-3B - registry objection to compliance with pre-depositPre-deposit requirement for filing appeal - reversal of CGST credit indicated in GSTR-3B - utilisation of electronic credit ledger for payment of arrears - Whether the appellant complied with the mandatory pre-deposit requirement by reversing 7.5% of the duty demand through CGST credit and indicating the same in GSTR-3B, thereby rendering the Registry's objection untenable. - HELD THAT: - The Registry had objected that the appellant was required to pay 7.5%/10% of the duty/tax and file proof thereof. The appellant produced letters and the GSTR-3B for August 2018 showing reversal of 7.5% of the duty demand through Central GST credit and relied on departmental circulars permitting payment of arrears through utilisation of amounts in the electronic credit ledger. The Revenue's representative accepted the legal position that the mandatory pre-deposit can be made through CGST credit. On these facts, the Tribunal found that the appellant had in fact reversed the requisite 7.5% via CGST credit and had indicated the same in Column 4B(2) of the GSTR-3B, and therefore the Registry's objection to recordal of the appeal lacked merit.Objection raised by the Registry set aside; Registry directed to take the appeal on record and list it for final disposal.Final Conclusion: The Tribunal held that the appellant had satisfied the pre-deposit requirement by reversing 7.5% of the duty through CGST credit as reflected in GSTR-3B; the Registry's objection was set aside and the appeal ordered to be taken on record and listed for final disposal. Issues: Objection raised by the Registry regarding pre-deposit payment by the appellant.Analysis:1. The Registry raised an objection that the appellant must pay 7.5%/10% of the duty/tax and provide proof. The appellant claimed to have already reversed 7.5% of the duty demanded through Central Goods and Service Tax Credit, as indicated in GSTR-3B for August 2018. They also informed the Assistant Commissioner about this payment. The appellant cited Circulars stating that arrears of duty can be paid through electronic credit ledger.2. The Tribunal considered the appellant's submission and found that they had indeed reversed 7.5% of the duty demand using CGST Credit, as reflected in their GSTR-3B for August 2018. The Assistant Registrar acknowledged that pre-deposit could be made through CGST Credit. Consequently, the Tribunal concluded that the objection raised by the Registry was baseless. The Tribunal directed the Registry to accept the appeal and list it for final disposal.This judgment clarifies the permissibility of making mandatory pre-deposits through CGST Credit, as supported by relevant Circulars. The Tribunal's decision to set aside the Registry's objection ensures procedural fairness and adherence to legal provisions concerning duty payments.