Appellate order quashed; matter remanded and electronic credit ledger accepted as valid pre-deposit under Section 107 GST

The HC allowed the petition, quashed the appellate order dated 22.04.2025, and remanded the matter to the appellate authority to decide the appeal afresh. The court directed the authority to accept the amount paid through the electronic credit ledger as a valid pre-deposit under Section 107 of the GST Act and to permit rectification if required, following the reasoning in the cited Division Bench decision, thereby enabling the appeal to proceed.

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The petition challenged an order dated 22.04.2025 dismissing an appeal on grounds that the pre-deposit via Electronic Credit Ledger was not a valid deposit under Section 107 of the GST Act and that the pre-deposit of Rs. 15,889/- was below the amount prescribed under Section 107(6). Reliance was placed on a Division Bench of the Gujarat High Court holding that, in terms of the Circular dated 06.07.2022, "the pre-deposit made through Electronic Credit Ledger would be a valid deposit," a decision whose Special Leave Petition was dismissed by the Supreme Court. A competing authority held that, where a deposit is not in accordance with law, the assessee ought to be confronted with the shortcoming and given an opportunity to rectify. The appellate order of 22.04.2025 was quashed and the matter remanded with directions to decide the appeal in accordance with law and to "accept the amount paid through electronic credit ledger as a valid deposit" for preferring an appeal under Section 107; any shortfall under Section 107(6) must be made good by the petitioner.

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