M/S. Skylark Infra Engineering PVT. LTD. vs. Union Of INDIA

Held

The Court decided that considering the need to determine factual aspects first, the petitioner should be relegated to the remedy of appeal before the GST Tribunal. The challenge to the vires of Section 19(1) of the IGST Act and Section 77(1) of the CGST and RGST Act, 2017, was expressly kept open. The Court directed that no further recovery proceedings for the balance amount would be initiated against the petitioner if the authorities were satisfied that the condition of pre-deposit for filing the appeal had been complied with. The petitioner was also directed to deposit the refunded amount received under IGST for these transactions. Since the GST Tribunal had not been constituted, the petitioner was granted three months from its constitution date to file the appeal. The Tribunal was directed to consider the appeal on merits after being satisfied about the pre-deposit compliance. The ratio is that where factual determination is a prerequisite, and a statutory appellate forum is available (even if not yet constituted), the High Court may relegate the parties to that forum while preserving substantive legal challenges.

Facts

The petitioner, M/s. Skylark Infra Engineering Pvt. Ltd., filed writ petitions challenging an order dated 23.09.2022 passed by the Appellate Authority, State Tax, Jaipur, which rejected their appeal for the assessment year 2017-18. The petitioner had treated certain supplies as inter-state and paid IGST. However, the respondent No. 3 classified these as intra-state supplies, levying CGST and SGST. The petitioner's grievance was that they had already deposited tax under the IGST Act. The petitions also challenged the vires of Section 19(1) of the IGST Act and Section 77(1) of the CGST and RGST Act, 2017. An interim order directed the petitioner to deposit 65% of CGST and RGST, subject to refund of IGST. The petitioner later submitted that the IGST refund received had been deposited with GST authorities, and other amounts were also deposited, fulfilling the pre-deposit requirement for appeal.

Key Issues

1. Whether the petitioner has complied with the pre-deposit requirement for filing an appeal before the GST Tribunal, considering the deposit of IGST refund and other amounts paid. Petitioner's contention: The petitioner argued that by depositing the IGST refund received from the Union of India and other amounts already paid, they have satisfied the prerequisite for filing an appeal before the GST Tribunal. They submitted that this compliance should be accepted. Revenue/State's contention: The judgment does not explicitly record arguments from the revenue or state regarding the compliance of pre-deposit. However, the court's direction to the petitioner to deposit the refunded IGST amount implies a concern for ensuring full compliance with pre-deposit norms. The court also noted that the GST Tribunal has not been constituted, impacting the procedural path for the petitioner.