Case: Balaram Halder v. State of West Bengal & Ors.
Court: Calcutta High Court
Petition No.: WPA 29142 of 2024
Date of Judgment: 20.01.2025
Category of Dispute: Recovery proceedings and stay of demand pending Tribunal constitution
Relevant Sections: Section 107(6), Section 112(8) & (9) of CGST Act; Circular No.224/18/2024-GST dated 11.07.2024
Facts (para 23–24, 2)
The petitioner challenged the appellate order dated 24 October 2024, contending that recovery should not proceed when the GST Appellate Tribunal has not yet been constituted. The petitioner relied on Circular No.224/18/2024-GST dated 11 July 2024, which clarified that recovery of confirmed demand shall remain stayed if taxpayers deposit the pre-deposit and furnish an undertaking to file an appeal before the Tribunal once operational.
Questions before the Court (para 23–25)
The primary issue was whether recovery proceedings could be initiated against the petitioner in absence of the Tribunal, despite his willingness to comply with the pre-deposit conditions under Section 112(8) of the CGST Act read with the Finance Ministry’s circular.
Observations (para 25–27)
The Court noted that the Tribunal had not yet been set up, and Circular 224/18/2024 protects taxpayers from coercive recovery in such circumstances. Since the petitioner had established a prima facie case, the demand of the appellate order required judicial scrutiny.
Judgment (para 27–29)
The Court granted an unconditional stay of the demand for two weeks. Further, it directed that if the petitioner deposits 10% of the balance disputed tax in addition to what was already deposited under Section 107(6), the interim protection will continue till disposal of the writ petition or until further orders. Directions were also given for filing affidavits within fixed timelines.
Table of referred circulars and provisions
| Reference | Key Outcome / Clarification |
|---|---|
| Circular No.224/18/2024-GST (11.07.2024) | Stay of recovery allowed when taxpayers pay pre-deposit and give undertaking to file Tribunal appeal when constituted. |
| Section 107(6), CGST Act | Requirement of 10% pre-deposit for appeal before Appellate Authority. |
| Section 112(8) & (9), CGST Act | Pre-deposit for Tribunal appeal and consequential stay on recovery until appeal is decided. |
Between Fine Lines
For businesses facing appellate demands, this ruling underscores that no coercive recovery should be pressed when the Tribunal is not yet operational. Taxpayers can safeguard themselves by paying the mandated pre-deposit and filing an undertaking, ensuring protection from recovery until the Tribunal becomes functional.
