Facts of the Case: In this case, the petitioner challenged the imposition of penalty and interest. The petitioner contended that the outstanding tax dues had already been paid during the pendency of adjudication proceedings after issuance of the show cause notice. Despite payment of tax, penalty and interest were imposed. Instead of filing an appeal immediately, the petitioner engaged in correspondence with GSTN seeking permission to file an appeal without making the mandatory pre-deposit of 10%, contending that no penalty was leviable once tax had been paid. During this process, the limitation period for filing the appeal expired. The petitioner approached the High Court seeking relief from the requirement of pre-deposit and also contended that it had valid grounds to explain the delay in filing the appeal.

The Revenue authorities submitted that there is no statutory power to waive the pre-deposit requirement. Pre-deposit is a mandatory condition for filing an appeal under the GST regime. The issue whether penalty was rightly imposed can only be examined by the appellate authority on merits after compliance with statutory requirements.

Issue:

Whether a taxpayer can be exempted from the mandatory pre-deposit requirement for filing an appeal under GST? Whether a taxpayer can be exempted from the mandatory pre-deposit requirement for filing an appeal under GST?

Held that:

The Court held that there is no exemption available under the GST law from making the statutory pre-deposit while filing an appeal. The requirement of pre-deposit is mandatory and cannot be waived merely because the petitioner disputes the imposition of penalty or claims to have paid the tax dues during adjudication. The Court observed that the correctness of the penalty or tax liability is a matter to be examined by the appellate authority on merits, and such dispute cannot be a ground to bypass the statutory pre-condition of pre-deposit.

However, considering that the petitioner had been corresponding with the authorities regarding the pre-deposit requirement and thereby missed the limitation period, the Court granted liberty to the petitioner to file an appeal within two weeks along with the statutory pre-deposit and an application for condonation of delay.

Case name: M/s. Orsu Yadaiah Versus Goods and Services Tax Network (GSTN), New Delhi, and three others. dated 10.02.2026