M/S. Orsu Yadaiah vs. Goods And Services Tax Network (Gstn)

WP/3775/2026HC TelanganaGSTCNR HBHC01006031202610 February 2026Bench: APARESH KUMAR SINGH,G.M. MOHIUDDIN8 pages

For Petitioner: SRI K. P. AMARNATH REDDYFor Respondent: SRI ARVIND KUMAR KATA, SC FOR CENTRAL GOVERMENT

AI SummaryPartly Allowed

Facts

The petitioner, M/s. Orsu Yadaiah, is challenging an order dated 31.09.2025 passed by the Assistant Commissioner (State Taxes) under Section 74 of the CGST Act and Telangana GST Act, 2017, for the tax period 2022-23. The order imposed a penalty and interest amounting to Rs. 15,11,348/-. The petitioner claims to have paid the outstanding dues after the show cause notice but before the adjudication proceedings concluded. However, the impugned order still imposed penalty and interest. The petitioner corresponded with GSTN to file an appeal without pre-deposit, as they believed no penalty was leviable due to prior payment. By the time this was resolved, the time for filing the appeal expired. The petitioner sought a direction to provide an effective remedy for filing appeals or to permit manual filing, disputing the tax, penalty, and interest.

Held

The Court held that there is no exemption for any taxpayer from making the pre-deposit while filing an appeal under the GST regime. The question of whether the penalty or tax was rightly imposed is a matter for the appellate authority to decide on merits after the appeal is filed. This cannot be a ground to seek exemption from making the pre-deposit. However, acknowledging that the petitioner was in correspondence with the authorities and missed the deadline for filing the appeal, the Court granted liberty to the petitioner to file an appeal within two weeks, along with a statutory deposit and a delay condonation application. The petitioner can raise all available grounds of law and fact in the appeal. The appellate authority is directed to consider the question of delay sympathetically, taking into account the circumstances, and if satisfied, proceed to decide the appeal on merits within a reasonable time, preferably within twelve weeks from the receipt of the order.

Key Issues

1. Whether the petitioner is entitled to an effective remedy for filing an appeal against the order dated 31.09.2025 passed by the Assistant Commissioner (State Taxes) under Section 74 of the CGST Act and Telangana GST Act, 2017, without making the pre-deposit, given that the tax dues were allegedly paid prior to the adjudication? Petitioner's contention: The petitioner argued that since the outstanding tax dues had already been paid, and they had good grounds to explain the delay in filing the appeal, they should not be compelled to make the pre-deposit of 10% against the penalty amount. They sought directions for an effective remedy or permission for manual appeal filing. Revenue's contention: The respondents, including GSTN and the Assistant Commissioner (State Taxes), argued that GSTN has no power to exempt pre-deposit for filing appeals. They contended that pre-deposit is a prerequisite for filing an appeal, and whether the deposit of tax during adjudication relieves the petitioner of penalty liability is a matter for the appellate authority to decide upon the appeal being filed with the pre-deposit. The petitioner cannot claim exemption from making the pre-deposit.

Sections Cited

Section 74

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

[ 3488 I IN THE HIGH COURT FOR THE STATE OF TEI-ANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TENTH DAY OF FEBRUARY TWO THOUSAND AND TWENW SIX PRESENT THE HONOURABLE THE CHIEF JUSTICE APARESH KUMAR SINGH AND THE HONOURABLE SRI JUSTICE G.M. MOHIUDDIN WRIT PETITION NO: 3775 OF 2026 Between: M/s. Orsu Yadaiah, Aged about 49 years Rep. by;its Proprietor, Mr. Orsu Yadaiah, 12-3712, Beeramguda,'Ameenapur, Hyderabad, Sangareddy, Telangana-5O2 O32. ...PETITIONER AND 1 Goods and Services Tax Network (GSTN), Worldmark 1, Aerocity, lndira Gandhi lnternational Airport, New Delhi, lndia-110037. 2. Assistant Commissioner (State Taxes), Mehdipatnam ll Circle, Charminar Division, Hyderabad. 3. State of Telangana, Rep. by its Secretary to Government (Revenue) CT-ll, Commercial Taxes State Tax Department, Secretariat, Hyderabad. 4. Union of lndia, Rep. by its Secretary (Finance), Ministry of Finance, North Block, New Delhi-110 001 ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, tl.te High Court may be pleased to issue a Writ of Mandamus or any other appropriate writ or order or direction to'direct (a) the f 3t Redpondenf to iirovirie the'Pcititioher an effective remedy for filing the appeals to the Appellate Authority against the impugned order dated 31912025 passed by the 2nd Respondent under Section 74 ot Central Goods and Services Tax Act, 2017 and also under Telangana Goods and Services Tax Act, 2017 for the tax period 2022-23 bi disputing the tax, penalty and interest or (b) alternatively grant the liberty by permitting the Petitioner to submit the manual Appeal before the Appellate Authority disputing the case on tax, penalty ernd lnterest for the tax period 2022-23 under the Central Goods and Services Tax Act, 2017 and also under Telangana Goods and Services Tax Act, 2017 against the order of the 2nd Respondent dated 3lgl2o2\. Counsel for the Petitioner: SRI K. P. AMARNATH REDDY Counsel for the Respondent No.l: SRI DOMINIC FERNANDES (senior standing counsel for CBIC) Counsel for l:he Respondent Nos.2 and 3: sRl K. sAl AKARSH, AGp FoR SRI SWAROOP OORILLA, SPECIAL GP FOR STATE TAX , Counsel for the Respondent No.4: SRI ARVIND KUMAR KATA, SC FOR CENTRAL GOVERMENT

The Court m,ade the following: ORDER i i i li i

IN THE TIIGH COURT FOR THE STATE OF TELANGANA AT IIYDERABAI) THE HON'BLE TTIE CHIEF JUSTICE SRI APARESII KTJMAR SINGII AI{D THE HON'BLE SRI JUSTICE G.M.MOIilUDDIN WRIT PETITION No. 3775of 2O26 DATED : 10.02.2026 Between: lWs. Orsu Yadaiah Petitioner ANI) Goods and Services Tax Network (GSTN), New Delhi, and three others Respondents ORDER: Sri K.P. Amarnath Reddy, learned counsel appears for petitioner. Sri Dominic Fernandes, learned Senior Standing Counsel for Central Board of [ndirect 'faxes and Customs appears for respondent No.

Sri K. Sai Akarsh, learned Assistant Government Pleader appears for Sri Swaroop Oorilla, learned Special Government Pleader for State Tax, fo1 respondent $99-.p_ and -lJ Sri Arvind Kumar Kata, learned Senior Standing Counsel for Central Government appears for respondent No.4. 2 HCJ (AKrS, J) & cMM, J W.P.No.3775 of 2026 I

The petitioner claims to have paid the outstanding dues after issuance of the show cause notice during the pendency of the rrdjudication proceedings, but the order dated 03.09.2025 has imposed the penarty and interest amounting to Rs.l5,11,348/- relatable to August and September,2022. The petitioner had been making correspondence with the GSTN to pernrit it to file an appeal without pre-deposit, as the outstanding tax dues had arready been paid and no case of penalty could be made out. However, in that process, time for filing the appeal expired. It is conrended by the learned counsel for the petitioner that the petitioner has good grounds to explain the delay. But, the petitioner may not be compelled to m;nke the pre-deposit of r0% against the penalty amount in the aforesaid circumstances.

Learned Senior Standing counsel appearing for GSTN subnrits that there is no power with GSTN to exempt the pre-deposit for filing the appeal.

Learned Assistant Government pleader appearing for the state Tax also submits that the pre-deposit is a prerequisite for /

3 HCJ {AKrS, Jl &GMM, J W.P.No.3775 of 2O26 t t filing the appeal. Whether the deposit of tax during the adjudication proceedings could relieve the petitioner of the liability of penalty is a matter to be decided by the appellate authority only upon the appeal being filed with pre-deposit. The petitioner, therefore, cannot claim any exemption from making the pre-deposit. Learned Assistant Government Pleader also submits that the petitioner may be allowed liberty to approach the appellate authority with an explanation for the delay within a stipulated period and take all such grounds of law and facts in its appeal

In the facts and circumstances noted above, since there is no exemption for any taxpayer from making pre-deposit while filing the appeal under the GST regime, whether the liability of penalty or tax was rightly imposed or not would be the subject matter of appeal on merits, the same cannot be a i ground to seek exemption from making the pre:dpposit. However, since the petitioner had been in correspondence with the respondent authorities on this issue and has missed the i I I j 1 t ( cut off date for filing the appeal, we grant liberly to the : : i ,l il I I i

4 HCJ (AKrS, J) & GMM, J W.P.No.3775 of 2O26 petitioner to file an appeal within a period of two weeks with statutoqr deposit and a delay condonation application. The petitionr:r may take all such grounds of law and facts in the memo of appeal as are available to it. Needtess to say, the appellate authority would consider the question of delay sympathetically taking into account the aforesaid facts and circumstances and if he is satisfied on the point of delay, he would proceed to decide the appeal on merits in accordance with law within a reasonable time, preferably, within twelve weeks flrom the date of receipt of a copy of this order. llccordingly, the instant writ Petition is disposed of. There sha[[ be no order as to costs. Miscellaneous applications, if any pending, sha[[ stand closed. I-M .OSMAN ALI BAIG GISTRAR ,,:" ASStsrA*]F I SECTION OFFICER

Goods and services Tax Network (GsrN), worldmark 1, Aerocity, lndira Gandhi tntematioi-J niri&, New Delhi' tnoia-t 10037'

Assistant Commissioner (State Taxes), Mehdipatnam ll Circle, Charminar Divisicln, HYderabad.

The secretary to Govemment (Revenue) cT-ll,.comnrercialTaxes State Tax D e p a rtm e nt, s l"ctEt""':''i ;' 56i;' oi te I a n g'a n a' H yd e ra b a d' 4.TheSecretary(Finance),Unionoflndia,MinistryofFinance,NorthBlock, New Delhi-110 001. E Ano (r(a tn sri K P. Amarnath Reddy' Advocate [OPUC] : I I i l I : To,

One CC to Sri Dominic Fernandes, (senior standing counsel for CBIC) [oPUc]

One CC to Sri Arvind Kumar Kata, SC for Central Government[OPUC]

Two CCs to the Special GP for State Tax, High Court for the State of Telangana, at Hyderabad[OuT]

Two CD Copies I TJ w

nrct HIGH COURT DATED 1010212026 I:.,Irr," t THE S ? 4 F!:fi fi'l L * N ':) ,J ,:1 ".19 'i.* ORDER WP.No.3,775 of 2A26 DISPOSING OF THE WRIT PETITION WITHOT'T COSTS 1 t I J r8 ot ab

Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.