M/S. Dunapothula Mahesh vs. Goods And Services Tax Network (Gstn)

Facts

The petitioner, M/s. Dunapothula Mahesh, received an order-in-original dated 03.09.2025 from the Assistant Commissioner (State Taxes), Hyderabad, imposing a tax liability of Rs. 15,50,886/-, a similar amount of penalty under Section 74(9) of the CGST Act, and interest of Rs. 8,89,232/- for the period September 2022. The petitioner claimed to have paid outstanding dues during adjudication but faced issues filing an appeal with the GSTN due to the requirement of pre-deposit, even after paying the tax. The petitioner had corresponded with GSTN regarding this, leading to the expiry of the appeal filing deadline. The petitioner sought a writ of mandamus to direct GSTN to provide an effective remedy for filing the appeal 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 to be decided on merits by the appellate authority upon filing the appeal. The Court acknowledged that the petitioner had been corresponding with authorities and missed the cut-off date for filing the appeal. Therefore, the Court granted liberty to the petitioner to file the appeal within two weeks with the statutory deposit and a delay condonation application. The petitioner can raise all available grounds of law and facts in the appeal. The appellate authority is directed to sympathetically consider the question of delay, 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 Goods and Services Tax Network (GSTN) has the power to exempt a petitioner from the pre-deposit requirement for filing an appeal under the GST regime, particularly when the petitioner claims to have paid the tax dues during adjudication proceedings and disputes the penalty and interest imposed, as per Section 107 of the CGST Act, 2017 and Telangana Goods and Services Tax Act, 2017? Petitioner's contention: The petitioner argued that having paid the outstanding tax dues during adjudication, and having grounds to dispute the penalty and interest, they should not be compelled to make a 10% pre-deposit against the penalty amount. They sought an effective remedy from GSTN or permission for manual appeal filing. Respondents' contention: The GSTN submitted that it has no power to exempt pre-deposit. The State Tax authorities argued that pre-deposit is a prerequisite for appeal and that the tax deposit during adjudication does not relieve the petitioner of the penalty liability, which must be decided by the appellate authority upon filing the appeal with pre-deposit. They suggested allowing the petitioner liberty to approach the appellate authority with an explanation for the delay.