https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=762347 https://www.taxtmi.com/caselaws?id=762347 Levy of differential GST on account of tax liability difference between Form GSTR-1 and GSTR-3B Returns filed for the period of 2017 to 2018 - Whether the petitioners are entitled to pay 10% of the disputed amount as a pre-condition in filing appeal by way of debiting the amount available in the Electronic Credit Ledger? - HELD THAT:- A reading of the Section would show that the amount available in the Electronic Credit Ledger may be used for making any payment towards output tax. The word used in the above provision is may and it is not shall . In the event if the word shall is used, the amount available in the Electronic Credit Ledger shall be utilized only for the purpose of payment of output tax. Further, in terms of Section 107(6) of TNGST Act, if 10% of the disputed tax has to be paid, it means that the deposit is made only towards discharging liability of output tax. In the event if the appellants are not succeeding, the amount paid by utilizing the Electronic Credit Ledger will be taken as output tax alone. Therefore, at no stretch of imagination, one can arrive at a conclusion that 10% of the amount paid as pre-condition for filing an appeal can be utilized other than the discharge of output tax. Rule 86(2) of TNGST Rules provides that Electronic Credit Ledger shall be debited to the extent of discharge any liability in accordance with the provisions of Section 49 or 49A or Section 49B. A reading of the Circular dated 06.07.2022 shows that input tax credit can be utilized not only for payment of the self assessed output tax but also payable as a consequence of the proceeding instituted under the provisions of GST Laws. This circular also clarifies the position that to discharge the liability of 10% of the output tax liability in terms of Section 107(6) of TNGST Act, the amount can be remitted through Electronic Credit Ledger. Further, as contended by the petitioners that the only restrictions on the usage of Electronic Credit Ledger for payment of pre-deposit is in respect of tax payable under reverse charge mechanism, as the same is outside the ambit of Section 2(82) of TNGST Act. In the present case, there was no remark under reverse charge mechanism on the petitioners in these proceedings. It is to be noted that the statutory appeal form APL-01 provides for the mechanism to pay pre-deposit by utilizing Electronic Credit Ledger as well. Further, vide circular dated 02.11.2023 the CBI C prescribed special procedure for filing appeals beyond the time period specified under Section 107 of TNGST Act on condition that out of 12.5% of the prescribed mandatory deposit, 20% ie., (2.5%) has to be paid by debiting the Electronic Cash Ledger. Therefore, it is evident that the remaining statutory mandatory pre-deposit (10% of the disputed tax) under Section 107(6) of TNGST Act can be very well made by using the amount available in Electronic Credit Ledger. This Court has no hesitation to come to the conclusion that the pre-deposit can be made through Electronic Credit Ledger. Therefore, the impugned orders passed by the 1st respondent are liable to be quashed, accordingly, quashed - Writ Petitions are allowed with a direction to the 1st respondent to take up the appeals filed by the petitioners on record, in the event if the appeals are dismissed only on the ground that pre-deposit has been made through Electronic Credit Ledger. Case-Laws GST Fri, 22 Nov 2024 00:00:00 +0530