Section 107(6) of the CGST Act, 2017 – Pre-deposit—Payment from Electronic Credit Register - The court observed that moot question in the petition is that whether, an Appellant, to comply with the requirements of Sub-section 6 of Section 107 of the Act of paying a sum equal to 10% of the amount of Tax in dispute arising out of the impugned order, can pay the amount utilising the credit available in the Electronic Credit Ledger. The court observed that it is a precondition to filing an Appeal under Section 107. The expression used is “paid” and not “deposited”. This would be material while considering the provisions of Sub-section (3), Subsection (4) and Sub-section (5) of Section 49. The Respondents submitted that Sub-section (4) of Section 49 restricts the usage of the amount available in the Electronic Credit Ledger only for payment of output tax and the amount available cannot be utilised for payment of tax under clause (b) of Sub-section (6) of Section 107. The court observed that they are not in agreement with the submission made because clause (b) of Sub-section (6) of Section 107 provides a precondition, “unless the appellant has paid” (not deposited) a sum equal to 10% of remaining amount of Tax in dispute. It says 10% of Tax has to be paid as a precondition. The amount of ITC available in the Electronic Credit Ledger can be utilised towards payment of Tax. The court further observed that CBIC vide circular F. No.CBIC-20001/2/2022-GST dated 6th July 2022 has clarified that any amount towards output tax payable, as a consequence of any proceeding instituted under the provisions of GST Laws, can be paid by utilisation of the amount available in the Electronic Credit Ledger.

Held that:- The Hon’ble Court set aside the impugned Order-in-Appeal dated 6th April, 2022 and restored the Appeal to file on the undertaking of Petitioner that it shall debit the Electronic Credit Ledger within one week of this order getting uploaded towards this 10% payable under Section 107(6)(b).