GST demand on royalty payments stayed pending reply after delay was explained during the COVID-19 period

A challenge was raised to an assessment order under the Uttar Pradesh GST law imposing tax on royalty payments, with interim protection sought against recovery pending reply. The petition was entertained after delay was explained with reference to the COVID-19 pandemic. The Court allowed filing of a counter affidavit and rejoinder, kept the matter pending for further hearing, and directed that the disputed demand remain stayed until the next date.

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Issues: Challenge to the order passed under Section 73 of the Uttar Pradesh Goods and Services Tax Act, 2017 imposing GST on royalty payment, and grant of interim protection against recovery pending reply.

Analysis: The petition was entertained despite delay being explained on account of the COVID-19 pandemic. The Court permitted filing of counter affidavit and rejoinder and kept the matter pending for further hearing. Till the next date, the disputed tax demand was directed to remain stayed.

Outcome: No final adjudication was made on the legality of the demand; interim stay was granted and the matter was left pending for further consideration.

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