Procedure of GST Appeals to Appellate Tribunal

We discussed basics of appeals and appeals to First Appellate Authority.  In this article, we will continue on Appeals to GST Appellate Tribunal (GSTAT).

In 2023, the Rajya Sabha approved a bill for the establishment of GST appellate tribunals, sets minimum age of 50 and modifies appointment terms. 
At the 50th GST Council meeting, various decisions pertaining to the GSTAT were taken- 
1. The GST Council discussed various locations in which the state benches of the appellate tribunal must be set and the timelines for the same. From 1st August 2023, the GST appellate tribunal shall come into effect. Necessary Rules shall be passed to allow appointment of President and Members. The number of State Benches is decided to be started in a phased manner, as per the recommendation done at the 50th GST Council meeting. 
2. The GST Council has allowed manual filing of appeal against the orders passed with respect to TRAN-1/ TRAN-2 filed by the migrated taxpayers. 
3. The authorities will introduce manual appeal filing under GST. 

Appeals to Appellate Tribunal

The government will constitute an Appellate Tribunal known as the Goods and Services Tax Appellate Tribunal to hear appeals against the orders passed by the Appellate Authority or the Revisional Authority.

Who can appeal to GST Appellate Tribunal?

A person unhappy with the decision of the First Appellate Authority or the Revisional Authority, can appeal against the decision to the National Appellate Tribunal (Appellate Tribunal). They must appeal within 3 months from the date of appeal along with the Form GST APL-05 and fees. As per the 53rd GST Council meeting, the recommended monetary limits for filing appeals by the department before these legal fora are Rs.20 lakh for GST Appellate Tribunal, Rs.1 crore for HC and Rs.2 crore for SC. 

Time limit to file appeals before the GSTAT: 

At the 53rd GST Council meeting held on 22nd June 2024, the GST Council recommended modifying Section 112 to provide a 3 months time for filing appeals before the GST Appellate Tribunal. It will start from a date yet to be notified by the Government, most likely to be announced by 5th August 2024 as this is the last date.

Fees

Every appellant must pay –

• The full amount from the original order that he agrees to (including tax, interest, fine, fee and penalty) and
• 20% of the amount of tax in dispute (At the 53rd GST Council meeting, it was recommended to reduce the pre-deposit value for appeal before the GST Appellate Tribunal from the present 20% with a maximum amount of Rs.50 crores each under CGST and SGST to 10% with a maximum of Rs.20 crores each under CGST and SGST).

What will be the constitution of the National Appellate Tribunal?

National Appellate Tribunal will be formed as follows-

• The National Bench (at Delhi) will be headed by a National President with 1 Technical member from Centre and from State (National Bench)
• Regional Benches (a Judicial Member, one Technical Centre Member and one Technical Member from State)
• One Bench for each State (State Benches) headed by State President
• Area Benches under State Benches
• Every State & Area Bench will consist of  judicial and technical persons (CGST and SGST) as prescribed
• The qualifications, eligibility and appointment of the National President, Judicial and CGST Members will be as per the Act and the recommendations of the Council.

Will all appeals be accepted?

The Appellate Tribunal can refuse to admit any appeal where the amount involved (tax/input tax credit/fine/fee/penalty) is lower than Rs. 50,000. If this committee is of the opinion that the order was not legal or not properly passed then it can direct any officer to apply to the Appellate Tribunal within 6 months from the appeal date (extendable by 3 months).

Sunset Clause are recommended to be added to amend Sections 109 & 117: Sunset clause to be added for anti-profiteering cases pending and decision taken to shift the hearing panel from CCI to principal bench of GSTAT. The GST Council has also recommended the sun-set date of 1st April 2025 for receiving any new application regarding anti-profiteering.

What happens to the party in whose favour the decision was made?

The benefitted party (in whose favour the earlier decision was made) will receive a notice that an appeal was sent to Appellate Party. They can then file a memorandum of cross-objections within 45 days of the receipt of notice. (Maybe extended for 45 days more if there is sufficient cause).

Decisions taken by the Appellate Tribunal

The Appellate Tribunal can confirm, modify or annul the decision or refer the case back to the First Appellate Authority [or the revisional authority].

It may also refer the case back to the original adjudicating authority, with directions for a fresh decision after considering any additional evidence. The Appellate Tribunal shall give the decision within a period of one year from the appeal filing date. A copy of the order passed will be given to-

• The First Appellate Authority or the revisional authority, i.e.., the original adjudicating authority
• The appellant
• The jurisdictional Commissioner of CGST and
• The jurisdictional Commissioner of SGST.

Will adjournment be allowed?

The Appellate Tribunal can adjourn the hearing of the appeal for maximum 3 times. The reasons for adjournment must be recorded in writing.

Can the Appellate Tribunal amend its own order?

The Appellate Tribunal can amend its order passed to rectify any apparent mistake within a period of three months from the date of the order. The mistake may be noticed by the Appellate Tribunal itself or may be brought to its notice by the Commissioner of GST or the other party to the appeal. Any amendment which will increase the tax liability or decrease the refund or input tax credit will be done only after a reasonable opportunity of being heard has been given. If the order is stayed by an order of a Court or Tribunal, the period of such stay shall be excluded from the one year period.

How will decisions be taken by the Appellate Tribunal?

The powers and functions of the Appellate Tribunal will be discharged by Benches. The State Bench & Area Bench shall consist of-

• 1 Judicial Member (Judicial)
• 1 CGST Member (Technical)
• 1 SGST Member (Technical)
• State President

A single member can dispose of any case where the amount involved is below 5 lakhs.

Difference in opinion in the Bench

Decision will be taken on basis of majority. If the members are equally divided, they shall refer to the National President or the State President. He shall refer the case to the other Benches. Then the decision will be taken on the basis of majority of the original and the referred bench.

Powers of the Appellate Tribunal

The Appellate Tribunal shall have the same powers as a court under the Code of Civil Procedure, 1908, for trying a case. It will be a deemed Civil Court.

Is interest payable on refund of fees?

If the fees deposited by the appellant is required to be refunded due to any order of the First Appellate Authority or of the Appellate Tribunal, as the case may be, and it is not refunded within 60 days interest will be payable from the date of payment of the fees till the date of refund. The interest rate will not exceed 18%. If he is not happy with the decision of the National Appellate Tribunal he can appeal to High Court and finally Supreme Court.

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