Tmp Manoharan And Co vs. Commissioner Of GST Central Excise (Appeals)

Facts

The petitioner, TMP Manoharan & CO, filed a writ petition challenging an order passed by the Commissioner of GST & Central Excise (Appeals) on September 4, 2025. The appeal was rejected due to the non-payment of the pre-deposit amount. The petitioner contended that they had already paid Rs. 3,09,440/- towards service tax as of March 20, 2018, and that 7.5% of the service tax, amounting to Rs. 1,33,562/-, was not payable as pre-deposit given the prior payment. The respondents argued that the Rs. 3,09,440/- pertained to periods prior to March 20, 2018, and even after adjusting this amount, the total service tax liability was quantified at Rs. 43,95,738/- as of March 20, 2018. A show cause notice was issued on October 1, 2018, which culminated in an order dated March 5, 2020, quantifying the service tax liability at Rs. 17,80,821/-, after giving due credit for payments made. The pre-deposit of 7.5% on this final liability was Rs. 1,33,562/-.

Held

The Court held that the petitioner's appeal was correctly rejected by the first respondent on the ground of non-payment of the mandatory pre-deposit. The Court found force in the respondents' submissions. It was established that the petitioner had paid Rs. 3,09,440/- as service tax as of March 20, 2018. However, even after adjusting this amount, the service tax liability was quantified at Rs. 43,95,738/-. Subsequently, a show cause notice was issued, and the final assessment order dated March 5, 2020, determined the total service tax liability at Rs. 17,80,821/-, giving due credit for amounts already paid. The Court reasoned that the petitioner was required to pay 7.5% of this final determined liability, which amounted to Rs. 1,33,562/-, as pre-deposit to challenge the assessment order before the appellate authority. The Court found no error in the impugned order rejecting the appeal for failure to make this pre-deposit. The petitioner's repeated reference to the earlier payment was deemed irrelevant in light of the subsequent final assessment. The Court dismissed the writ petition and did not grant liberty to approach the GSTAT, stating it was up to the petitioner to challenge the impugned order.

Key Issues

1. Whether the petitioner was liable to pay a pre-deposit of Rs. 1,33,562/- before their appeal could be considered by the appellate authority, considering their prior payment of Rs. 3,09,440/- towards service tax. Petitioner's arguments: The petitioner argued that the prior payment of Rs. 3,09,440/- was sufficient and that the 7.5% pre-deposit, calculated as Rs. 1,33,562/-, was not required. They contended that the appellate authority failed to consider this vital aspect and dismissed the appeal without seeking an explanation regarding the Rs. 3,09,400/- which the respondent stated pertained to pre-deposits in other forums. Respondents' arguments: The respondents argued that the Rs. 3,09,440/- related to a period prior to March 20, 2018. They asserted that even after adjusting this amount, the total service tax liability was Rs. 43,95,738/- as of March 20, 2018. The final assessment order dated March 5, 2020, quantified the liability at Rs. 17,80,821/- after considering all payments. Therefore, the mandatory pre-deposit of 7.5% (Rs. 1,33,562/-) on this final liability was not paid, leading to the rejection of the appeal.