Assessee had already paid ₹30.81 crore TCS under protest during the disputed period — Bombay High Court held that no further 10% pre-deposit was required under Section 107(6)(b) of the CGST Act.
ISSUE:
Whether TCS amount already paid by the Assessee under protest during the disputed period could be adjusted towards the mandatory 10% pre-deposit requirement under Section 107(6)(b) of the CGST Act, 2017.
RULE:
Section 107(6)(b) of the CGST Act requires pre-deposit of 10% of the disputed tax amount, subject to the statutory ceiling. A taxing statute is to be construed strictly and literally. If the law does not expressly exclude amounts already paid under protest, such payment cannot be ignored while testing compliance with the statutory pre-deposit condition.
APPLICATION:
The Assessee had been facing disputed GST liability for the period from 1 October 2018 to March 2022. From April 2021 onwards, the Assessee had collected and deposited TCS under protest amounting to ₹30,81,91,182/-. The Department argued that such TCS payment amounted to admission of liability and could not be treated as payment towards disputed tax.
The Court noted that the fact of payment under protest was not disputed. Relying on the Supreme Court judgment in VVF (India) Ltd., the Court held that amounts paid anterior to assessment and under protest are to be considered for determining statutory pre-deposit, unless the statute specifically provides otherwise.
CONCLUSION:
Since the Assessee had already deposited ₹30.81 crore under protest, which exceeded the maximum pre-deposit ceiling of ₹20 crore under Section 107(6)(b), the Court held that the Assessee had prima facie fulfilled the statutory pre-deposit requirement. The earlier order requiring separate 10% deposit was modified, and no further deposit was required.
IMPACT ANALYSIS:
This judgment strengthens the principle that amounts already paid under protest cannot be mechanically ignored while computing statutory pre-deposit. It gives practical relief to taxpayers where substantial tax has already been deposited during the disputed period, even before appeal or writ proceedings.
Title: MARKETS LTD. vs. UNION OF INDIA
Court: HIGH COURT OF BOMBAY
Citation: 101 TLC(GST) 046
Dated: 05-05-2026
Provision: Under Section 107(6)(b)
ISSUE:
Whether TCS amount already paid by the Assessee under protest during the disputed period could be adjusted towards the mandatory 10% pre-deposit requirement under Section 107(6)(b) of the CGST Act, 2017.
RULE:
Section 107(6)(b) of the CGST Act requires pre-deposit of 10% of the disputed tax amount, subject to the statutory ceiling. A taxing statute is to be construed strictly and literally. If the law does not expressly exclude amounts already paid under protest, such payment cannot be ignored while testing compliance with the statutory pre-deposit condition.
APPLICATION:
The Assessee had been facing disputed GST liability for the period from 1 October 2018 to March 2022. From April 2021 onwards, the Assessee had collected and deposited TCS under protest amounting to ₹30,81,91,182/-. The Department argued that such TCS payment amounted to admission of liability and could not be treated as payment towards disputed tax.
The Court noted that the fact of payment under protest was not disputed. Relying on the Supreme Court judgment in VVF (India) Ltd., the Court held that amounts paid anterior to assessment and under protest are to be considered for determining statutory pre-deposit, unless the statute specifically provides otherwise.
CONCLUSION:
Since the Assessee had already deposited ₹30.81 crore under protest, which exceeded the maximum pre-deposit ceiling of ₹20 crore under Section 107(6)(b), the Court held that the Assessee had prima facie fulfilled the statutory pre-deposit requirement. The earlier order requiring separate 10% deposit was modified, and no further deposit was required.
IMPACT ANALYSIS:
This judgment strengthens the principle that amounts already paid under protest cannot be mechanically ignored while computing statutory pre-deposit. It gives practical relief to taxpayers where substantial tax has already been deposited during the disputed period, even before appeal or writ proceedings.
Title: MARKETS LTD. vs. UNION OF INDIA
Court: HIGH COURT OF BOMBAY
Citation: 101 TLC(GST) 046
Dated: 05-05-2026
Provision: Under Section 107(6)(b)
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