No pre-deposit for penalty-only appeals if SCN issued prior to 1 October 2025 when provisions amended to mandate such deposit

The Hyderabad Bench of the GSTAT has answered in negative the question as to whether the assessee was required to remit pre-deposit of 10% in terms of proviso to Section 112(8) of the CGST Act [Appeal to Tribunal], for a penalty-alone appeal, on an order that was passed well before the introduction of the said proviso i.e., on 1 October 2025. The Tribunal in Hero Wiretex Limited v. Commissioner observed the following:

• Delhi HC in Gaurav Jain v. Joint Commissioner examined similar amendment to Section 107(6) [Appeal to Appellate Authority] [See, LKS Indirect Tax Amicus for July 2026 here]. It was held that since SCN was issued prior to 1 October 2025 the lis was instituted before the amendment came into force, and hence appeals arising out of such pre-amendment proceedings, even if filed after 1 October 2025, are not liable to pre-deposit.

• Both Section 107(6) and Section 112(8) operate on the same textual footing concerning pre-deposit obligations for appeals.

• SCN was issued on 24 December 2021 in present case. Section 112(8), as it stood then did not impose a pre-deposit requirement for penalty-only cases.