2026 (2) TMI 1388 - HC - GST

Statutory appellate remedy permitted subject to prescribed pre-deposit; Appellate Authority to consider favourable insolvency orders on final disposal.

Petitioner seeking to challenge a GST demand where supplier is under liquidation is permitted to pursue the statutory appellate remedy; the Appellate ... Input tax credit - company under the control of a liquidator, failed to discharge the tax liability - pre-deposit requirement - liquidation under insolvency proceedings - period of limitation - Period of limitation - HELD THAT:- The impugned order is dated 16.10.2025 and the present writ petition was filed on 15.12.2025, which is within the period of limitation prescribed for filing an appeal before the Appellate Authority against the impugned order. Pre-deposit condition - Since the issue is stated to be pending before the said forum, this Court is inclined to dispose of the writ petition by granting liberty to the petitioner to challenge the impugned order before the Appellate Authority. Accordingly, the petitioner is granted liberty to file an appeal before the Appellate Authority, subject to the condition that the petitioner complies with the statutory requirement of depositing 10% of the disputed tax as pre-deposit within a period of thirty (30) days from the date of receipt of a copy of this order. Appellate authority to consider subsequent favourable NCLT order - In case the petitioner secures any favourable order from NCLT, the same shall be taken into consideration by the Appellate Authority at the time of final disposal. In case the petitioner fails to file such an appeal, the respondent shall be at liberty to proceed against the petitioner in the manner known to law. This writ petition is disposed of with the above observations. Issues: Whether the petitioner should be permitted to challenge the impugned order dated 15.10.2025 before the Appellate Authority and on what conditions, having regard to alleged liquidation of the supplier and pending proceedings before the National Company Law Tribunal and the Insolvency and Bankruptcy Board of India grievance forum.Analysis: The impugned order confirmed part of the demand under the GST proceedings. The petitioner asserts that input tax credit was taken based on supplier invoices and that the supplier was under liquidation, with liquidation approved by the National Company Law Tribunal and a complaint pending under Regulation 3(3) of the Insolvency and Bankruptcy Board of India (Grievance and Complaint Handling Procedure) Regulations, 2017. The petition was filed within the period available for filing an appeal to the Appellate Authority. Given the existence of related proceedings before the NCLT and the grievance forum, the appropriate recourse is to allow the statutory appellate remedy to be pursued, subject to the statutory pre-deposit requirement, and to permit the Appellate Authority to take any favourable orders from the NCLT into account at final disposal.Conclusion: The petitioner is granted liberty to file an appeal before the Appellate Authority subject to depositing 10% of the disputed tax as pre-deposit within thirty days from receipt of the order; the Appellate Authority shall consider any favourable order obtained from the NCLT at the time of final disposal.