Voluntary deposits under Section 73(5) CGST Act satisfy pre-deposit requirements for Section 107(6) appeal filing

The Bombay HC held that voluntary deposits made under Section 73(5) of CGST Act can be considered for pre-deposit compliance under Section 107(6) for appeal filing. The court ruled that procedural requirements cannot defeat substantive appeal rights or render them illusory. Relying on VVF India Ltd. v. State of Maharashtra, the court emphasized that appeal rights must be effective and meaningful, not frustrated by complex procedural formalities. The petitioner was permitted to file appeal within two weeks, with the appellate authority directed to recognize the voluntary deposit for pre-deposit compliance purposes.

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Issues Involved:
1. Functionality of the GSTN Portal preventing the filing of a statutory appeal.
2. Whether the voluntary deposit under Section 73(5) of the CGST Act can be considered for pre-deposit under Section 107(6) of the CGST Act.

Summary:

Issue 1: Functionality of the GSTN Portal
The Petitioner approached the court under Article 226 of the Constitution of India, contending that the GSTN Portal's malfunction prevented the lodging/filing of a statutory appeal under Section 107 of the CGST Act. The Petitioner intended to take the benefit of the voluntary deposit made under Section 73(5) of the CGST Act for compliance with Section 107(6), which mandates a pre-deposit of tax, interest, fine, fee, and penalty before filing an appeal.

Issue 2: Consideration of Voluntary Deposit for Pre-Deposit
The Petitioner argued that the voluntary deposit under Section 73(5) should be accepted towards the pre-deposit requirement under Section 107(6). The Petitioner cited the Supreme Court's decision in VVF (India) Ltd. vs. State of Maharashtra, which recognized that an anterior deposit could be considered for pre-deposit requirements.

The Revenue opposed this, arguing that Sections 73(5) and 107(6) operate distinctly and that voluntary deposits should not be adjusted for pre-deposit requirements. The Union of India supported this view, emphasizing the uniform application of the electronic portal.

Court's Analysis and Decision:
The court found merit in the Petitioner's arguments, stating that procedural rules should not defeat the substantive right of appeal. The court noted that the voluntary deposit under Section 73(5) is not in pursuance of any demand or assessment order and should be considered for compliance with Section 107(6). The court referred to the Supreme Court's decision in VVF (India) Ltd., which allowed the consideration of an anterior deposit for pre-deposit requirements under similar provisions of the MVAT Act.

Order:
1. The Petitioner is permitted to file an appeal under Section 107 of the CGST Act either electronically or manually within two weeks.
2. The Appellate Authority is directed to register the appeal by considering the voluntary deposit under Section 73(5) for compliance with Section 107(6).
3. The appeal should be registered either electronically or manually as deemed appropriate by the Appellate Authority.
4. The appeal should be adjudicated on merits without any objection as to the limitation, considering the Petitioner was bonafide pursuing the present proceedings.

All petitions were disposed of with no costs.

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