stay of demand

[SUSHIL BANSAL]

Dear experts,

as per circular No. 29/2023 dated 31.07.2023, now no need to deposit 10% of tax for filing appeals. In such a situation the demand will be treated as auto stayed or we need to take stay.

Further 10% tax deposit condition is not for penalty ?

[KASTURI SETHI]

Is Circular No. correct ?

[SUSHIL BANSAL]

Sir,

Sorry its notification related to TRAN-1/2 matters related appeals.

[KASTURI SETHI]

Answer to query no.1 : NOT auto stayed. Will have to apply for stay order separately.

Anwer to query no.2 : Pre-deposit is restricted to tax in dispute. It does not include penalty and fine.

[SUSHIL BANSAL]

Sir,

FAQs > Filing an Appeal against Demand Order (FORM GST APL-01) says as under

10. Whether the balance disputed amount is stayed on filing Appeal?

Yes, if Appeal filed is admitted, the GST Portal flags the balance disputed amount as non-recoverable.

plz guide further

[KASTURI SETHI]

(i) W.r.t.. your query at serial no.4 above, please read the question of FAQ carefully. The question asks, 'whether the balance amount ________? The words, 'balance amount' mean fixed percentage of pre-deposit has been made. That is why the question talks of BALANCE amount.

(2) Secondly, FAQ has no statutory force at all.

(3) Thirdly, the date of issuance of FAQ is prior to the issuance of Notification No.29/23-CT dated 31.7.23.

[SUSHIL BANSAL]

Sir,

Section 107(7) also talks about auto say of balance demand

[KASTURI SETHI]

Sh. Sushil Bansal Ji,

In order to be safe, the best option is to seek advice in advance from the Supdt.(Appeals) posted in the office of the Appellate Authority.

[Amit Agrawal]

Dear Querist,

Provisions of making pre-deposit (while filing appeals with first appellate authority & tribunal) were there in erstwhile excise & service tax regime as well since year 2014 / 2015. And, prescribed pre-deposit was made while filing appeal, there was always stay on balance demand (i.e. till appeal is disposed of).

And I do not see any confusion what-so-ever from reading of sub-section (6) & (7) of Section 107 and same is duly explained in earlier post of mine.

Over these years, I have filed hundreds of appeals for my clients (both in erstwhile regime & GST regime) after making prescribed pre-deposit. And Dept. NEVER sought separate application for stay for balance demand EVER.

W.r.t. appeal in special cases for Trans-1/2 matters emanating from the directions of the Hon’ble Supreme Court in the case of Union of India v/s Filco Trade Centre Pvt. Ltd., SLP(C) No.32709-32710/2018.- 2022 (7) TMI 1232 - SC ORDER), you must mention serial No. 3 of Notification No.29/23-CT dated 31.7.23 in your appeal memorandum itself (i.e. against re-deposit columns) explaining reasons for not making any pre-deposit. And, these procedures are binding on first appellate authority, being issued under Section 148 of the CGST Act, 2017.

If any objection is indeed raised at the time of / after filing of appeal (though I doubt it very much, when legal provisions are so clear), you can always educate concerned Dept. officer.

These are ex facie views of mine and the same should not be construed as professional advice/suggestion.

[KASTURI SETHI]

(No separate application for stay is required to be filed, if pre-deposit amount is paid.

AI Summary

Pre-deposit requirement for GST appeals affects stay of balance demand; reference procedural notification in appeal memo. The notification removing the prescribed pre-deposit for specified TRAN-1/2 appeals does not by itself create an automatic stay on the balance disputed tax; historically, payment of a pre-deposit made the remaining disputed tax non-recoverable and the portal may flag balances as non-recoverable when an appeal is admitted, but such FAQ descriptions lack statutory force. Pre-deposit covers disputed tax only, not penalty or fines, and practitioners should reference the notification serial in the appeal memorandum and confirm office practice with the Superintendent (Appeals).