The Central Board of Indirect Taxes & Customs (CBIC) on October 26, 2026, issued a clarification on various issues pertaining to the amount paid as pre-deposit.
The following has been stated:
• CBIC has clarified the requirements for pre-deposit payments and refunds when filing appeals under Sections 107(6) and 112(8). The admitted amount, comprising tax, interest, fine, fee and penalty that the taxpayer does not intend to dispute, shall be paid in full, while the mandatory pre-deposit of 10% is calculated on the disputed tax amount. For appeals before the Appellate Tribunal, the pre-deposit is calculated based on the disputed tax liability confirmed by the Appellate Authority, in addition to the amount already paid at the first appeal stage. Appellate orders need not expressly direct the refund of pre-deposits; taxpayers shall apply through FORM GST RFD-01 under the category “On account of order.”
• Refunds cannot be denied merely because the Department intends to file or has filed a further appeal, unless the favourable order is stayed by the Appellate Tribunal or a Court. Interest on refundable pre-deposits under Section 115 is calculated separately from the actual payment date at each appeal stage.
• Where the Appellate Tribunal remands a matter, the pre-deposit is refundable within the prescribed time; in cases of partial remand, the amount relating to the demand upheld in favour of the Revenue, along with applicable interest, shall be recovered or adjusted before the balance is refunded.
[Notification No. - 259/05/2026-GST]
