Facts of the Case:

In this case, the petitioner challenged an order passed by the Appellate Authority under Section 107, whereby the petitioner’s appeal was dismissed on two grounds (i) delay in filing appeal, and (ii) non-compliance with the statutory pre-deposit requirement.

The adjudication order under Section 74 was passed on January 7, 2025. The appeal, due by April 7, 2025, was filed on April 26, 2025, i.e., beyond the initial three-month period but within the condonable period of one month under Section 107(4). The petitioner submitted that since the adjudication order determined only interest and penalty, with nil tax liability (the tax having already been paid through DRC-03 on March 12, 2021), no pre-deposit was required under Section 107(6) as it then stood. The Appellate Authority, however, rejected the appeal for delay and for non-payment of pre-deposit.

Issue:

Whether an appeal under Section 107 of the CGST/WBGST Act, 2017, filed prior to 1st October 2025, could be rejected for non-payment of pre-deposit when the appeal pertained only to penalty and interest, and whether the delay in filing the appeal could be condoned within the extended period provided under the statute.

Held that:

The High Court allowed the writ petition and remanded the matter to the Appellate Authority with the following findings

• No Pre-deposit Required Prior to 01.10.2025 for Penalty-only Appeals – As per Section 107(6) in its unamended form, pre-deposit was linked only to “tax in dispute.” There was no statutory requirement for pre-deposit where the appeal concerned only penalty or interest without any tax demand. The Finance Act, 2025 inserted a proviso mandating 10% pre-deposit even for penalty-only orders, but this amendment took effect from October 1, 2025, and could not be applied retrospectively.
• Error in Rejection for Non-existent Condition – The Appellate Authority erred in rejecting the appeal for want of pre-deposit when no such condition existed at the relevant time. Non-existent statutory conditions affecting a substantive right of appeal cannot be imported into the statute.
• Condonation of Delay – The Court noted that an application for condonation of delay had indeed been filed by the petitioner. The matter was remanded to the Appellate Authority to consider such application and, if satisfied with the cause shown, condone the delay and hear the appeal on merits.

Case Name: Barjinder Singh Kohli Versus The Assistant Commissioner of Revenue & Ors. dated 03.11.2025

To read the complete judgement 2025 Taxo.online 2833