TaxTMI 
TaxTMI 
2025 (12) TMI 1892
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....ort) that has been transitioned from the erstwhile Cenvat Credit regime to the GST regime through filing of Form TRAN-1. It is his contention that deploying such migrated credit now reflected in the Electronic Credit Ledger under the GST laws would suffice fulfilment of the statutory requirement of the pre-deposit under Section 35F of the Central Excise Act as applicable to service tax matters. It is his contention that prior to introduction of GST laws, the payment of pre-deposit was allowed to be made by debiting cenvat credit account which has been confirmed in CESTAT Circular No.15/CESTAT/General/2013-14 dated 28.08.2014. Also, this decision was recognised in the judicial pronouncement in the case of UOI and Ors Vs. Vikrant Tyres Ltd. [1999-VIL-64-KAR-CE]. It is submitted that with the advent of GST regime on 1st July, 2017, the cenvat credit scheme was subsumed into unified framework of ITC under the CGST Act, 2017 and Section 140 of the CGST Act provides for migration of unutilised cenvat credit of eligible duties into electronic credit ledger of a registered person as transitional credit. This was a statutory mandate and not optional, intended to protect the right of the ass....
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....all not be entertained unless the appellant deposits a prescribed percentage of duty or penalty adjudged. 3.3. The Revenue's submissions are as below:- ➢ In the GST era, the mechanism for settlement of such obligations is governed strictly by transitional and operational provisions under the CGST Act, including Section 49 and Section 41. ➢ Section 49(4) stipulates in clear and unambiguous language, "The amount available in the electronic credit ledger may be used for making payment towards output tax as defined under Section 2(82) of the CGST Act." The Hon'ble Orissa High Court in Jyoti Construction v. Deputy Commissioner of CT & GST, Jajpur [(2021) 131 taxmann.com 104 (Orissa)] has conclusively held that output tax cannot be equated with pre-deposit required for appeals, and therefore, ITC cannot be debited for payment of pre-deposit under the scheme of the CGST Act. ➢ On identical lines, the Hon'ble CESTAT Allahabad in Johnson Matthey Chemical India Pvt. Ltd. v. Assistant Commissioner CGST, And Central Excise [Defect Dairy No. 701942022, order dated 23.08.2022], held that the credit available in the electronic credit ledger under....
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.... ➢ The principle consistently followed by the Courts and Tribunal is that beneficial procedural circulars may operate retrospectively, but restrictive or oppressive circulars apply prospectively only (see Mysore Electricals Industries Ltd., Supreme Court 2006 204 ELT 517). In the present case, as the appeals and payments were effected after the issuance of the decisive circulars and instructions, the requirement for cash payment through the portal is squarely applicable. ➢ The appellant's reliance on Cadila Health Care Pvt. Ltd. v. Union of India (2018) 18 GSTL 30 Guj., must be distinguished as referring to rights under the erstwhile regime, not the GST era. The statutory shift after 1.7.2017, read with the express language of Sections 41 and 49 and the Board's categorical directions, foreclose the possibility of treating ITC under GST as eligible payment for pre-deposit required by legacy law appeals. ➢ Further, in case the appellant is successful in the Appeal proceedings as per the existing provisions the refund of pre-deposit of amounts pertaining to the existing laws is to be refunded by way of cash. The refund procedure in the GST law be....
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....3 challans in cash and debiting Electronic Credit Ledger after transition of credit from old regime to GST regime. Revenue in its earlier Circular dated 24.06.2019 though prescribed revised procedure for making payments of Central Excise and Service Tax arrears, no specific bar has been laid down thereunder in discharging the pre-deposit amount through DRC-03 prescribed for payment under GST regime. The matter has been considered by the Hon'ble High Court of Bombay High Court in Sodex India Services Pvt. Ltd. case (supra). In the said case, the learned Commissioner (Appeals) refused to entertain an appeal filed by the assessee where pre-deposit was made through DRC-03 . In the said facts, their Lordships held as follows: "8. Therefore, it does appear that the confusion seems to be due to there being no proper legal provision to accept payment of pre-deposit under Section 35F of the Central Excise Act, 1944 through DRC-03. Some appellants are filing appeals after making pre-deposit payments through DRC-30/GSTR-3B. In our view, this has very wide ramifications and certainly requires the CBI & C to step in and issue suitable clarifications/guidelines/ answers to the FAQs. We ....
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....his regard. 2. The matter has been examined. It may be seen that Form GST DRC03 is prescribed for payment of tax, interest, penalty under sub-sections (5) and (8) of both sections 73 and 74. and section 129 (1) of the CGST Act. 2017 or any other payment due in accordance with the provisions of the CGST Act. 2017 as specified in rule 142 (2) and 142 (3) of the CGST Rules. 2017. Further, in GST regime, in connection with appeal mechanism under section 107 of the CGST Act. 2017. Rule 108 (1) of the CGST Rules. 2017 provides Form GST AP1.-01 for tiling an appeal with option of payment of admitted amount and pre-deposit through electronic cash-credit ledger. Thus, under GST Act also. Form GST DRC - 03 is not a prescribed mode for payment of pre-deposit. 3. Attention is invited to Miscellaneous transitional provisions sub-section (6)(b). sub-section (6)(a), and sub-section (8Ma) of section 142 of the CGST Act, 2017, which, inter alia, provides that any credit. lax. interest, line or penalty recoverable from the person before, on or after 1st July, 2017 under the existing law (Central Excise Act and Chapter-V of Finance Act. 1994) shall be recovered as an arrear of tax u....
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....ntertained. In other defective appeals, where the pre-deposits have been made after 28.10.2022, the appellants are directed to make pre-deposit under "CBIC (ICEGATE) E-payment" portal as per Circular dated 24.06.2019 within a period of four weeks from the date of communication of the order. 10. The appellant in their submission heavily relied upon the judgement of the Hon'ble Gujarat High Court in the case of Yasho Industries Ltd. (supra). In our opinion, the said judgment is not applicable to the facts of the present case since the same was delivered in a different set of circumstances. The assessee in the said case has been availing refund of IGST paid on exports in terms of Section 16(3)(b) of the Integrated Goods and Services Tax Act, 2017 as it stood prior to omission of Finance Act, 2021; the IGST exemption conferred by Notification No.79/2017-Cus dated 13.10.2017 on import of raw materials incorporated in the manufacture of exported goods on the strength of validly issued Advance Authorisation Licences. The petitioner was compelled to deposit Rs.3.00 crores which they paid under protest i.e. by reversing the ITC equivalent to INR 3.00 crores vide Form DRC-03. In such circ....