Case Summary
Case Title: M/s. Adani Wilmar Limited & Anr. v. Deputy Commissioner of State Tax & Ors.
Court: Calcutta High Court
Petition Number: WPA 29243 of 2024
Judgment Date: 22.01.2025
Category of Dispute: Recovery proceedings – Stay of demand pending appeal before unconstituted Appellate Tribunal
Relevant Sections: Section 107(6), Section 112(8), Section 112(9) of the CGST Act, read with Circular No. 224/18/2024-GST dated 11.07.2024
Facts (Para 1–5)
The petitioners challenged the appellate order dated 18th June 2024 passed by the State Tax Appellate Authority. They relied upon Circular No. 224/18/2024-GST dated 11th July 2024, which provides that recovery of outstanding dues must remain in abeyance until the GST Appellate Tribunal is constituted, provided the taxpayer makes the pre-deposit under Section 112(8) and files an undertaking. The petitioners argued that since the Tribunal was yet to be formed, coercive recovery was impermissible.
Questions (Para 6–7)
The central issue was whether recovery could proceed against the petitioners despite their intent to appeal, given that the Tribunal is not yet functional, and whether interim relief ought to be granted based on compliance with the pre-deposit conditions.
Observations (Para 8–12)
The Court noted that the Ministry’s Circular clarified the procedure: once 10% of the disputed tax (in addition to the 10% already deposited under Section 107(6)) is paid, and an undertaking to appeal is furnished, recovery proceedings stand stayed as per Section 112(9). The Court observed that the Tribunal’s absence cannot prejudice taxpayers. The petitioners had demonstrated a prima facie case, justifying interim relief.
Judgement (Para 13–16)
The Court granted an unconditional stay of the demand raised under the appellate order dated 18th June 2024 for two weeks. It further directed that if the petitioners deposit 10% of the balance disputed tax within two weeks, the stay would continue until disposal of the writ petition or further orders. Directions for affidavits were also given.
Table of Cases Referred
| Case / Circular | Citation / Reference | Verdict / Principle |
|---|---|---|
| Circular No. 224/18/2024-GST (MoF) | 11.07.2024 | Recovery stayed pending Tribunal constitution, subject to pre-deposit & undertaking |
| CGST Act, Section 107(6) | Statutory | Requires 10% deposit of disputed tax for first appeal |
| CGST Act, Section 112(8)-(9) | Statutory | Stay of demand upon pre-deposit while filing Tribunal appeal |
Between Fine Lines
This ruling provides critical reassurance to taxpayers: until the GST Appellate Tribunal is constituted, recovery of dues from appellate orders cannot be forced, provided the taxpayer makes the statutory pre-deposit. Businesses facing disputed demands can rely on this judgment to safeguard working capital and avoid coercive recovery.
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