HC Directed Department to Utilize Penalty Amount Deposited in Electronic Cash Ledger Towards Pre-deposit & Hear Appeal

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  • Last Updated on 17 October, 2023

Electronic Cash Ledger

Case Details: Batra Brothers (P.) Ltd. v. Union Territory of Ladakh - [2023] 155 taxmann.com 266 (Jammu & Kashmir and Ladakh)

Judiciary and Counsel Details

    • Sanjeev Kumar & Puneet Gupta, JJ.
    • Subodh Singh JamwalAshish Nanda, Advs. for the Appellant.
    • Vishal Sharma for the Respondent.

Facts of the Case

The petitioner filed an appeal against adjudication order but the appeal was dismissed due to non-payment of 25% pre-deposit of penalty as mandated under first proviso to sub-section (6) of Section 107 of CGST Act, 2017. The petitioner filed writ petition against the rejection order and contended that the amount was deposited under electronic cash ledger.

High Court Held

The Honorable High Court noted that the petitioner made payment of 25% of penalty amount by depositing in electronic cash ledger. As per Section 49, the amount available in electronic cash ledger could be used by assessee for making any payment towards tax, interest, penalty, fees or any other amount payable under provisions of this Act.

In the instant case, the requisite amount was already deposited in electronic cash ledger by petitioner, therefore, it would be appropriate and in interest of justice to hear appeal and permit department to take out and utilize amount of pre-deposit. Thus, the Court held that the appeal shall be taken up for consideration on merits.

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