Recovery Proceeding Deemed To Be Stayed If Appellant Pays 10% Of Disputed Tax Amount During Pendency Of Appeal: Jharkhand High Court

[15 June 2022] The Jharkhand High Court bench of Justice Aparesh Kumar Singh and Justice Deepak Roshan has held that upon deposit of 10% of the disputed tax amount during the pendency of appeals, recovery of any remaining balance is deemed to have been stayed in view of Section 107 Sub-section (6) and (7) of the CGST Act, 2017.
The notice under Section 79 of the CGST Act, 2017 was issued by the respondent/department for alleged recovery of government dues amounting to Rs. 4,28,86,464 upon the petitioner’s banker, United Bank of India, without any adjudication process under Section 73 and 74 of the Act. The alleged dues relate to Central Goods and Services Tax, pertaining to the period of July, 2017 to March, 2019. However, the dues have been computed only on the basis of one GSTR-1 statement without giving the benefit of the input tax credit admissible to the petitioner as claimed through the GSTR-3B statement. “The impugned garnishee proceeding, therefore, cannot be given effect to and, in fact, has become infructuous. Any fresh demand arising out of the decision of the Appellate Authority can be met by the issuance of GST APL-04. As such, there is no purpose in keeping the writ petition pending. It is disposed of as infructuous,” the court ordered.