GST Appeal Resolved: Petitioner Wins Right to Pay from Electronic Credit Ledger, Challenging Restrictive Payment Mandate

HC allowed petitioner's writ challenging GST appeal payment requirements. The court set aside the Appellate Authority's order and directed reconsideration of the appeal, permitting payment from Electronic Credit Ledger. The Commissioner of Commercial Taxes was instructed not to insist on Electronic Cash Ledger payment, effectively resolving the procedural dispute in favor of the petitioner.

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Issues involved: Interpretation of GST Act regarding payment of appeal amounts from Electronic Cash Ledger or Electronic Credit Ledger.

The High Court of Patna addressed the issue of whether ten per cent of due amounts in an appeal should be paid from the Electronic Cash Ledger or the Electronic Credit Ledger. The petitioner had paid the amount from the Electronic Credit Ledger, but the Appellate Authority rejected the appeal, stating that the payment should be made from the Electronic Cash Ledger. The Court referred to a previous Division Bench judgment in M/s Flipkart Internet Pvt. Ltd. v. The State of Bihar & Ors., which supported the payment from the Electronic Cash Ledger. However, the Supreme Court had stayed certain observations of that judgment. Additionally, a notification by the Ministry of Finance allowed delayed appeals with a payment of 12.5 per cent, with at least 20 per cent of that amount required to be paid from the Electronic Cash Ledger. The Court acknowledged the binding nature of the Division Bench judgment but decided to consider the appeal on its merits, given the stay by the Supreme Court.

Regarding the specific case, the Court set aside the Appellate Authority's order and directed a reconsideration of the appeal on its merits. The Commissioner of Commercial Taxes, Patna was instructed not to insist on the payment of ten per cent from the Electronic Cash Ledger, allowing the appeal to proceed based on the amount already paid from the Electronic Credit Ledger. Ultimately, the writ petition was allowed with the provided directions.

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