Agsons Agencies (I) PVT LTD vs. Additional Commissioner Adjudication CGST Delhi North & Ors.
Original PDF →Facts
The Petitioner, Agsons Agencies (I) Pvt. Ltd., filed a writ petition before the Delhi High Court under Article 226 and 227 of the Constitution of India. The petition sought a waiver of the 10% pre-deposit mandated under Section 107(6) of the Central Goods and Services Tax Act, 2017. The Petitioner argued that it was facing significant financial difficulties, with its accounts classified as Non-Performing Assets. It also contended that its reply was not properly considered in the impugned order dated January 17, 2025. The impugned order was passed in relation to 77 firms found to be involved in fraudulent Input Tax Credit by utilizing fake and non-existent entities.
Held
The Court held that the pre-deposit requirement under Section 107 of the Central Goods and Services Tax Act, 2017, is a statutory mandate. It stated that such a mandate cannot be violated unless extraordinary circumstances warranting a waiver are present. The Court found no such extraordinary circumstances in the present case to justify waiving the pre-deposit. The Petitioner was advised that it is free to approach the Appellate Authority in accordance with the law and may file an application for waiver of pre-deposit before the Appellate Authority, which would then be considered by the Appellate Authority as per the law. The Court did not express any opinion on the merits of the underlying case concerning the alleged fraudulent Input Tax Credit.
Key Issues
1. Whether the Petitioner is entitled to a waiver of the 10% pre-deposit under Section 107(6) of the Central Goods and Services Tax Act, 2017, given its alleged financial difficulties? Petitioner's contention: The Petitioner argued that due to severe financial distress, including its accounts being declared Non-Performing Assets, the statutory pre-deposit should be waived. It also claimed that its reply was not adequately considered in the impugned order. Revenue's contention: The Revenue did not explicitly present arguments in the judgment regarding the waiver of pre-deposit. However, the Court's reasoning implicitly addresses the statutory nature of the pre-deposit.
Sections Cited
Section 107(6), Section 107
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 25.04.2025
This hearing has been done through hybrid mode.
The present petition has been filed by the Petitioner- Agsons Agencies (I) Pvt. Ltd. under Article 226 and 227 of the Constitution of India, inter alia, seeking waiver of pre-deposit of 10% under Section 107(6) of the Central Goods and Services Tax Act, 2017. 3. Mr. Garg, ld. Counsel for the Petitioner has vehemently urged before the Court that the Petitioner is suffering from various financial difficulties and it’s account has been turned as a Non-Performing Asset. He further submits that even the reply has not been considered in the impugned order dated 17th January 2025 (hereinafter, ‘impugned order’).
The Court has considered the matter. A perusal of the show cause notice dated 24th July 2024 and the impugned order would show that the impugned order has been passed in respect of 77 firms who were found to be availing This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 22:08:44
fraudulent Input Tax Credit by floating fake and non-existent firms.
The case of the Petitioner is that it is suffering from financial difficulties and, therefore, the pre-deposit may be exempted.
Pre-deposit under Section 107 of the Central Goods and Service Tax Act, 2017 is a statutory mandate and unless there are extraordinary circumstances which require waiver of a pre-deposit, the statutory mandate cannot be violated.
The Petitioner is free to approach the Appellate Authority in accordance with law.
The Court is not inclined to waive the pre-deposit in the present case.
If the Petitioner so chooses, it may file an application for waiver of pre- deposit before the Appellate Authority which shall be considered by the Appellate Authority in accordance with law.
The petition is disposed of in these terms. All pending applications, if any, are also disposed of. PRATHIBA M. SINGH, J. RAJNEESH KUMAR GUPTA, J. APRIL 25, 2025 dj/ck This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 01/07/2025 at 22:08:44
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.