Orissa High Court Disposes Writ as GST Tribunal Becomes Operational: Must Comply with Pre-Deposit Mandate
Introduction
The Orissa High Court recently addressed a critical issue concerning the availability of statutory remedies under the Goods and Services Tax framework when the designated appellate forum had not been functional. In the matter of Shiva Prasad Pattnaik Vs Commissioner, the Court disposed of a writ petition after taking note of the fact that the Goods and Services Tax Appellate Tribunal (GSTAT) has now been constituted and extended timelines have been notified for filing appeals. The judgment emphasizes the principle that while writ jurisdiction remains available when statutory remedies are absent, it cannot be invoked to bypass mandatory statutory conditions once the appellate forum becomes operational.
The petitioner had approached the High Court challenging an assessment order issued under Section 73 of the Central Goods and Services Tax Act, 2017 and the Odisha Goods and Services Tax Act, 2017, which was subsequently upheld by the first appellate authority. The core contention was that despite the availability of a second appeal under Section 112 of the GST Act before the GSTAT, such remedy could not be pursued as the Tribunal had not been constituted or made functional at the relevant time.
Background Facts
Original Assessment Order
The CT & GST Officer, Bhubaneswar-II Circle, Bhubaneswar passed an order dated 25 July 2022 concerning the tax periods spanning from April 2019 to March 2020. This order was issued under Section 73 of both the Central Goods and Services Tax Act, 2017 and the Odisha Goods and Services Tax Act, 2017. The order presumably raised tax demands, interest, and penalties against the assessee.
First Appellate Order
Aggrieved by the original assessment, the petitioner filed an appeal before the first appellate authority. However, the Appellate Authority dismissed the appeal and affirmed the original order on 27 March 2023. This left the petitioner with the statutory option of filing a second appeal before the GSTAT under Section 112 of the GST Act.
Challenge Before High Court
Since the GSTAT had not been constituted or was non-functional at the time, the petitioner approached the Orissa High Court through a writ petition. The primary ground was that an aggrieved person cannot be left without any remedy when the statutory appellate forum is unavailable through no fault of their own.
Contentions of the Parties
Petitioner's Arguments
The counsel representing the petitioner advanced the argument that although Section 112 of the GST Act provides a statutory remedy by way of appeal to the GSTAT, such remedy remained illusory and unavailable due to the non-constitution and non-functioning of the said Tribunal. It was contended that the principle of natural justice and constitutional guarantees require that an aggrieved person must have access to an effective remedy, and when the statutory forum is not available, the High Court must exercise its writ jurisdiction.
Department's Stand
The Standing Counsel representing the CT & GST Department acknowledged that the GSTAT had indeed not been constituted or made functional during the relevant period. However, the Department vehemently argued that this fact did not absolve or exempt the petitioner from fulfilling the mandatory pre-deposit requirement prescribed under Section 112(8) of the GST Act.
The Department emphasized that the provision casts a statutory obligation upon any appellant to deposit:
- The full amount of tax, interest, fine, fee, and penalty that stands admitted by the appellant; and
- Additionally, a sum equivalent to ten per cent of the remaining disputed tax amount, subject to a ceiling of twenty crore rupees.
According to the Department, these conditions are mandatory and constitute a condition precedent for filing an appeal before the Tribunal. The writ court, even while exercising extraordinary jurisdiction, cannot permit an appellant to circumvent these statutory requirements.
Statutory Framework: Section 112(8) of the GST Act
The relevant provision of Section 112(8) of the GST Act reads as follows:
"(8) No appeal shall be filed under sub-section (1), unless the appellant has paid—
(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him, and
(b) a sum, equal to ten per cent of the remaining amount of tax in dispute, in addition to the amount paid under sub-section (6) of Section 107, arising from the said order, subject to a maximum of twenty crore rupees, in relation to which the appeal has been filed."
This provision clearly establishes that filing an appeal before the GSTAT is contingent upon compliance with the pre-deposit requirement. The statute leaves no room for discretion in this regard, making it a mandatory condition.
Notification and User Advisory for GSTAT
Notification S.O. No. 4220(E) dated 17 September 2025
The Court took judicial notice of a significant notification issued by the Department of Revenue, Ministry of Finance, bearing number S.O. No. 4220(E) dated 17 September 2025. This notification was issued in exercise of powers conferred by sub-section (1) of Section 112 of the Central Goods and Services Tax Act, 2017, based on recommendations of the GST Council.
The notification prescribed the following timelines:
For Orders Communicated Before 1 April 2026:
Appeals may be filed before the Appellate Tribunal up to 30 June 2026, regardless of when the order sought to be appealed against was communicated, provided it was communicated before 1 April 2026.
For Orders Communicated On or After 1 April 2026:
Appeals must be filed within three months from the date on which the order is communicated to the person preferring the appeal.
This notification provided a substantial window of opportunity for all aggrieved persons to file their appeals before the GSTAT, thereby removing the excuse of non-availability of the statutory forum.