In MAT No.823 of 2023 -CAL HC- Calcutta High Court sets aside Single Bench order requiring Appellant to pay 20% interest amount, holds payment of 10% disputed tax sufficient for appeal under CGST Act
Chief Justice T.S. Sivagnanam & Justice Uday Kumar [16-06-2023]

Read Order: Liakhat Ali Mallick v. The State of West Bengal & Ors

Chahat Varma

New Delhi, June 21, 2023:  The Calcutta High Court has set aside an order passed by a Single Bench of the High Court which had directed the appellant to pay 20% of the interest amount. A Division Bench of the High Court emphasized that Section 107(7) of the Central Goods and Services Tax Act, read with Section 107(6), explicitly mandates the payment of only 10% of the disputed tax when preferring an appeal.

Briefly stated, in this intra-Court appeal, the appellant had challenged a garnishee notice on the grounds that he had already paid the entire tax amount as demanded and had also filed an appeal before the appellate authority. However, the garnishee notice was issued before the expiry of the appeal filing period. The Single Bench granted a stay on the garnishee notice but imposed a condition that the appellant must deposit 20% of the interest liability.

The division bench of Chief Justice T.S. Sivagnanam and Justice Uday Kumar remarked “Considering the facts and circumstances of the case and also the statutory requirement, which mandates payment of only 10% of the disputed tax, we are of the view that a condition need not be imposed by directing the appellant/petitioner to pay 20% of the interest.”