Bharati Singh vs. Union Of INDIA And Ors.

Held

The Court held that the petitioner should be afforded an opportunity to make a reduced pre-deposit for the purpose of preferring her appeal. While acknowledging the statutory requirement and the revenue's reliance on the Supreme Court judgment, the Court considered the petitioner's plea of bankruptcy and acute financial stress. The Court directed the petitioner to deposit a sum of ₹2 Lakhs only within three weeks from the date of the order for the appeal to be heard on its merits. The Court reasoned that this reduced amount would allow the petitioner to pursue her appeal while acknowledging her financial predicament. If the petitioner defaulted on this deposit, the order would stand vacated, and the department would proceed according to law. The Court disposed of the writ petition with these directions.

Facts

The petitioner, Bharati Singh, approached the High Court of Calcutta seeking relief from making a pre-deposit for an appeal against an order. The total demand against the petitioner was ₹38 Lakhs and odd. The petitioner claimed to be bankrupt and facing acute financial stress, with her residential property having been sold under SARFAESI. She stated she was struggling for sustenance and business revival and could not meet basic expenses. The petitioner contended she had good grounds on merits if her appeal was heard without the full pre-deposit. The CGST Authority argued that the petitioner should deposit 10% of the demand for preferring the appeal, citing a Supreme Court judgment in M/s Simla Gomti Pan Products Pvt. Ltd. Vs. Commissioner of State Tax U.P. & Ors.

Key Issues

1. Whether the petitioner, facing bankruptcy and acute financial distress, can be exempted from or granted a reduced pre-deposit amount for preferring an appeal against the impugned order, despite the statutory requirement for pre-deposit, and if so, to what extent? Petitioner's Arguments: The petitioner argued that due to her financial insolvency and inability to meet basic expenses, she cannot afford the statutory pre-deposit. She asserted that she has strong merits in her case and should be allowed to present her appeal without the financial burden of a full pre-deposit, emphasizing her dire financial circumstances. Revenue's Arguments: The CGST Authority contended that the petitioner should be directed to deposit 10% of the demand amount for preferring the appeal. They relied on the Supreme Court's decision in M/s Simla Gomti Pan Products Pvt. Ltd. Vs. Commissioner of State Tax U.P. & Ors., where a substantial pre-deposit was mandated even in a case with a significantly higher demand.