Interim Relief Granted Due to Non-Functionality of GST Tribunal

Case Summary:

• Case Title: M/s. Saroj Leathers (India) Private Limited vs Deputy Commissioner of GST & Central Excise

• Court: High Court of Judicature at Madras

• Petition Number: WP. No.31883 of 2022

• Category of Dispute: Demand for Interest and Penalty

• Date of Judgement: 21.04.2025

• Relevant Sections: Section 112 of CGST Act, 2017

• CGST Rules Referred: Not applicable

Facts of the Case (Para 1–2)

• The petitioner, M/s. Saroj Leathers (India) Pvt. Ltd., challenged the appellate order dated 13.07.2022 (Order-in-Appeal No. 222/2022), which affirmed the original order dated 21.09.2021 (Order-in-Original No.112/2021) imposing interest and penalty under GST.

• The petitioner contended that although the Act permits appeal against the appellate authority’s order to the GST Appellate Tribunal, such a tribunal was yet to be constituted or made functional at the time of filing the writ.

Question(s) in Consideration (Para 2–3)

• Whether the petitioner can invoke the writ jurisdiction of the High Court under Article 226 in the absence of a functional appellate tribunal?

• Whether interim relief can be granted upon willingness to pay the statutory pre-deposit of 10% under Section 112(8) of the CGST Act?

Observation of Court (Para 3–4)

• The Court acknowledged the petitioner’s right to appeal under the Act and noted that due to the non-functioning of the GST Appellate Tribunal, the petitioner had no alternative but to approach the High Court.

• The Court appreciated the petitioner’s bona fide readiness to deposit 10% of the balance tax, which aligns with statutory pre-deposit requirements under Section 112 of the CGST Act.

Judgement of the Court (Para 4–5)

• The High Court granted an interim stay of the demand, subject to the condition that the petitioner deposits 10% of the balance tax within four weeks from receipt of the order.

• The Court clarified that failure to deposit within the prescribed time would lead to automatic vacation of the stay.

• The writ petition was disposed of with liberty to appeal as and when the Tribunal becomes operational.

Between Fine Lines

1. The High Court allowed interim relief due to the non-constitution of the GST Appellate Tribunal.

2. Petitioners were required to deposit 10% of the disputed tax to avail the stay.

3. The Court provided liberty to file a formal appeal once the Tribunal becomes functional.

4. The order protects the petitioner from immediate enforcement of interest and penalty.

5. This judgment affirms judicial support when appellate remedies are practically unavailable.

Summary of Referred Cases

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