As per Circular no.224/18/2024 – GST dated 11th July 2024, CBIC has clarified that though Appellate tribunal is not functional, where the first appellate authority has confirmed the demand either fully or partially, the taxpayers willing to approach the appellate tribunal under section 112 of the CGST Act, should pay the pre-deposit as mentioned in sub section (8) of section 112 to bring a stay against the recovery proceedings under section 78 of the CGST Act.
The payment of pre-deposit to be made by navigating from GST dashboard to:
Services >> Ledgers >> Payment towards demand
The taxpayer would be navigated to Electronic Liability Register (ELL) Part-II in which he can select the order, out of the outstanding demand orders, against which payment is intended to be made. The amount so paid would be mapped against the selected order and demand amount would be reduced in the balance liability in the aforesaid register. The said amount deposited by the taxpayer will be adjusted against the amount of pre-deposit required to be deposited at the time of filing appeal before the Appellate Tribunal.
The taxpayer also needs to file an undertaking/ declaration with the jurisdictional proper officer that he will file appeal against the said order of the appellate authority before the Appellate Tribunal, as and when it comes into operation, within the timelines mentioned in section 112 of the CGST Act. On providing the said undertaking and on payment of an amount equal to the amount of pre-deposit, the recovery of the remaining amount of confirmed demand as per the order of the appellate authority will stand stayed as per provisions of sub-section (9) of section 112 of CGST Act.
In case, the taxpayer does not make the payment of the amount equal to amount of pre-deposit or does not provide the undertaking/ declaration to the proper officer, then it will be presumed that taxpayer is not willing to file appeal against the order of the appellate authority and in such cases, recovery proceedings can be initiated as per the provisions of law. Similarly, when the Tribunal comes into operation, if the taxpayer does not file appeal within the timelines specified in Section 112 of the CGST Act, the remaining amount of the demand will be recovered as per the provisions of law.
If the taxpayers have already paid the pre-deposit through Form GST DRC 03, then said person can file an application in Form GST DRC 03A electronically on the common portal and the said amount will be adjusted against said pre-deposit. Till this functionality is made available, the taxpayer is advised to inform the proper officer about the same.
Our remarks:
Though there is no legal backing of this circular and circular cannot overrule the law. When the tribunal itself is not constituted, where is the question of payment of pre-deposit. But considering the urgency of the officers to collect money and meet targets, it is advised to follow the above procedure, to stop the recovery proceedings.