Pre deposits (appeal)

[DEEPAK SHARMA]

A individual seek to file appeal before 1st appellate authority..... How they can deposit pre deposit 7.5% of penalty for stay the matter

Please suggest

[V Rajalakshmi]

Mr Deepak Sharma

Kindly ref to sec 107 (6) (b) of CGST, the aggrieved party is required to pay 10% of the disputed tax, and no interest or penalty.

[Shilpi Jain]

This is in the context of Customs I suppose and not GST.

Also now there is no concept of 'stay the matter'.

It is a compulsory payment of pre deposit for appeal

[Padmanathan KV]

Dear querist, just to bring to your attention the recent decision in MOHAMMED AKMAM UDDIN AHMED & ORS. VERSUS COMMISSIONER APPEALS CUSTOMS AND CENTRAL EXCISE & ORS. 2023 (5) TMI 23 - DELHI HIGH COURT wherein the court has allowed petitioner to file appeal without pre-deposit.

The observation of court is as follows:

20.1 The Allahabad High Court in the Ganesh Yadav case (supra) while upholding the constitutional validity of Section 35F of the CE Act has enunciated that the statute may, at times, impose conditions as a requirement of filing an appeal. However, a condition which is unduly onerous will render the right to appeal as a nought. It was held that:

“3. ....As a first principle of law, a right of appeal is a statutory right and it is open to the legislature which confers a remedy of an appeal to condition the appeal subject to compliance with conditions. A fiscal legislation can stipulate a requirement of pre-deposit as a condition precedent to an appeal to be entertained. The restraint on the power of the legislature to do so, is that the condition which is prescribed should not be so onerous so as to restrict or abrogate the right of appeal altogether. A condition which is unduly onerous will render the right of appeal illusory and would hence run the risk of being held to be arbitrary and of being violative of the fundamental right conferred by Article 14 of Constitution.”

[Emphasis is ours]

20.2 Therefore, given the financial position and the wherewithal of the Petitioners, an opportunity needs to be given to them to contest the valuation so imposed by the Respondents, which, otherwise cannot be contested by them. Thus, we consider the case of the Petitioners to be an appropriate case to exercise our discretion in the matter concerning waiver of pre-deposit of penalty.

The matter is fact specific and you will have to approach jurisdictional high court for waiver of pre-deposit.

AI Summary

Pre-deposit requirement for appeals can be compulsory, but courts may waive onerous deposits denying meaningful access to appeal. An aggrieved party seeking appellate redress must comply with statutory pre-conditions for appeal filing, including payment obligations specified by the relevant enactment. Statutory pre-deposits are treated as a compulsory pre-condition rather than a mechanism to obtain a stay. Courts have recognized that unduly onerous pre-deposit conditions that effectively deny access to appeal may be waived in fact-specific cases, and judicial discretion can be invoked where parties lack the financial capacity to contest valuation or penalty determinations.