Section 107 of CGST Act read with Rule 109A of CGST Rules, appoints First Appellate Authority to hear the appeal of Tax Payer/Department against any decision or order passed by an Adjudicating authority.
Vide Rule 109A of CGST Rules, the Central Government has appointed
The Commissioner (Appeals) has been appointed as Appellate authority to hear appeal against any order/decision of Additional/Joint Commissioner
Whereas, The Additional/Joint Commissioner (Appeals) have been appointed as Appellate Authority to hear appeal against any order/decision of Deputy/Assistant Commissioner or Superintendent.
Note: It is to be noted that Appellate Authority will be appointed by the Central, State or UT Governments as the case may be vide their respective Rules for their administered Taxpayers. In this article, we will discuss provisions of CGST Act and Rules thereunder.
In this article, we will discuss everything about First Appellate Authority (Commonly known as Commissioner(Appeals) or Additional/Joint Commissioner (Appeals) in GST) towards its Appellate Side including orders which can be appealed, Process of filing appeal, Pre-Deposit, Procedure before GSTAT, appeal option against Decision of GSTAT.
Area Covered in the Article:
A. Orders which can be Appealed in the Appellate Authority (Section 107)
(a) Any order passed or decision taken by the Adjudicating Authority can be appealed in the Appellate Authority.
Section 2(4): "adjudicating authority" means any authority, appointed or authorised to pass any order or decision under this Act, but does not include the 1 [Central Board of Indirect Taxes and Customs], the Revisional Authority, the Authority for Advance Ruling, the Appellate Authority for Advance Ruling, 2 [the National Appellate Authority for Advance Ruling,] 3 [ the Appellate Authority, the Appellate Tribunal and the Authority referred to in sub-section (2) of section 171. |
(b) Appeal with the Appellate Authority can be filed by the Aggrieved Party who can either be the Department or the Taxpayer. Technically in case of Department, it is termed as Application instead of Appeal.
c) Time Line to file appeal in Appellate Authority is Three months from the date of communication of the order/decision. (Not the date of order) for the Assessee.
d) Time Line to file appeal in Appellate Authority is Six months from the date of the Communication of Order/Decision for the Department. Commissioner can direct officer subordinate to him to file appeal with the Appellate Authority.
e) Appellate Authority can condone the delay in filing of Appeal by One month if it is satisfied that there was sufficient cause for not presenting it within that period.
B. Concept of Pre-Deposit & Refund of it (Section 107 & 115)
In case Assessee desires to file an appeal with GSTAT, he needs to deposit certain percentage of Tax, interest, penalty, fine arising out of order of Adjudicating Authority as per details below:
(a) 100% of Tax, interest, penalty & fine which is admitted by the Taxpayer.
(b) 10% of the Remaining Tax Amount which is disputed (here interest, penalty, fine is not there as Tax itself is disputed) . Maximum amount required is Rs. 25 Crores.
(c) In case Penalty order issued under Section 129(3) (related to Detention, seizure and release of goods and conveyances in transit) is challenged, 25% of the Penalty amount needs to be deposited.
(d) Where Taxpayers deposited aforesaid amount, recovery proceedings for balance amount of tax amount as confirmed by Adjudicating Authority will be deemed to be stayed till the disposal of Appeal.
(e) Where Pre-Deposit Amount is required to be refunded consequent to any order of the Appellate Authority, interest at the rate specified under section 56 (6%) shall be payable in respect of such refund from the date of payment of the amount (not the date of order ) till the date of refund of such amount.
C. Process of Filing appeals with Appellate Authority (Rule 108)
(a) An appeal to the Appellate Authority shall be filed by the Taxpayer along with the relevant documents either electronically or otherwise as may be notified by the Commissioner in FORM GST APL-01, and a provisional acknowledgement shall be issued to the appellant immediately. Thereafter, certified copy of the decision or order appealed against shall be submitted on common portal within seven days of the filing of the appeal and a final acknowledgement shall be issued thereafter in FORM GST APL-02 by the Appellate Authority or an officer authorised by him in this regard . (Only after issuance of Final Acknowledgement, Appeal will be considered as filed).
(b) Where the certified copy of the decision or order is submitted within seven days, the date of filing of the appeal shall be the date of the issue of the provisional acknowledgement and where the said copy is submitted after seven days, the date of filing of the appeal shall be the date of the submission of such copy. (Important to Note, as there is time limit of three months/six months to file appeal).
(c) Appeal by the Department (Technically called as Application under Rule 109) will be filed in the Form GST-APL-03 along with relevant documents. A certified copy of the decision or order appealed against shall be submitted within seven days of filing the application and an appeal number shall be generated by the Registrar.
(d) In case, Decision/order appealed against is not uploaded on Common Portal, the applicant or the Department as the case may be, shall submit self certified copy of said decision/order with in period of Seven Days from the date of filing of Form GST APL-01/03.
D. Order of Appellate Authority (Section 107 & Rule 113)
(a) The Appellate Authority shall give an opportunity to the appellant of being heard.
(b) The Appellate Authority can adjourn the hearing also but not more than three times during hearing of appeal.
(c) The Appellate Authority shall, after making such further inquiry as may be necessary, pass such order, as it thinks just and proper, confirming, modifying or annulling the decision or order appealed against but shall not refer the case back to the adjudicating authority that passed the said decision or order.
Vide this clause, Appellate Authority has been given the vast power to do even further investigation in the case and can also order to enhance the Tax, interest , penalty or fine as the case may be..
However,
(i) an order enhancing any fee or penalty or fine in lieu of confiscation or confiscating goods of greater value or reducing the amount of refund or input tax credit shall not be passed unless the appellant has been given a reasonable opportunity of showing cause against the proposed order.
(ii) where the Appellate Authority is of the opinion that any tax has not been paid or short-paid or erroneously refunded, or where input tax credit has been wrongly availed or utilised, no order requiring the appellant to pay such tax or input tax credit shall be passed unless the appellant is given notice to show cause against the proposed order and the order is passed within the time limit specified under section 73 or section 74.
Here, it appears that Appellate Authority will issue SCN and after the SCN it can directly issue Order without the stage of Adjudication.
(d) The order of the Appellate Authority disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reasons for such decision.
(e) The Appellate Authority shall, along with its order under sub-section (11) of section 107, issue a summary of the order in FORM GST APL-04 clearly indicating the final amount of demand confirmed.
(f) The Appellate Authority shall as far as possible will hear and decide every appeal with in period of One Year from the date on which it is filed.
E. Appeal against the Order of Appellate Authority
Decisions of Appellate Authority can be appealed before GSTAT as constituted under Section 109. (Please read complete Appellate procedure before GSTAT at:
F. Admissibility of Additional Evidences before Appellate Authority (Rule 112)
The appellant shall not be allowed to produce before the Appellate Authority any evidence, whether oral or documentary, other than the evidence produced by him during the course of the proceedings before the adjudicating authority except in the following circumstances, namely
(a) where the adjudicating authority has refused to admit evidence which ought to have been admitted;
(b) where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by the adjudicating authority ; or
(c) Where the appellant was prevented by sufficient cause from producing before the adjudicating authority any evidence which is relevant to any ground of appeal; or
(d) where the adjudicating authority has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal.
No evidence shall be admitted under sub-rule (1) unless the Appellate Authority records in writing the reasons for its admission.
The Appellate Authority shall not take any additional evidence produced unless the adjudicating authority or an officer authorised in this behalf by the said authority has been allowed a reasonable opportunity - (a) to examine the evidence or document or to cross-examine any witness produced by the appellant; or to produce any evidence or any witness in rebuttal of the evidence produced by the appellant under sub-rule (1).
Nothing contained in this rule shall affect the power of the Appellate Authority to direct the production of any document, or the examination of any witness, to enable it to dispose of the appeal.
G. Concept of Authorised Representative in GST (Section 116)
Taxpayers can appoint Authorised Representative to present before the Officers, Appellate Authority or GSTAT on his behalf until unless Personal Presence of Taxpayer is sought by the Authorities.
Following persons can be appointed as Authorised Representative by the Taxpayer:
(a) his relative or regular employee; or
(b) an advocate who is entitled to practice in any court in India, and who has not been debarred from practicing before any court in India; or
(c) any chartered accountant, a cost accountant or a company secretary, who holds a certificate of practice and who has not been debarred from practice; or
(d) a retired officer of the Commercial Tax Department of any State Government or Union territory or of the Board who, during his service under the Government, had worked in a post not below the rank than that of a Group-B Gazetted officer for a period of not less than two years: Provided that such officer shall not be entitled to appear before any proceedings under this Act for a period of one year from the date of his retirement or resignation; or
(e) any person who has been authorised to act as a goods and services tax practitioner on behalf of the concerned registered person.
H. Procedure & Power to be Adopted by the Appellate Authority (Section 107,106,105)
The Appellate Authority shall, for the purpose of exercising its powers regarding-
(a) discovery and inspection;
(b) enforcing the attendance of any person and examining him on oath;
(c) issuing commissions and compelling production of books of account and other records, have all the powers of a civil court under the Code of Civil Procedure, 1908.
The Appellate Authority shall, subject to the provisions of this Chapter, have power to regulate its own procedure.
I. Withdrawal of Appeal (Rule 109C w.e.f. 26.12.2022 vide Notification No. 26/2022-C.T.)
The appellant may, at any time before issuance of show cause notice under sub-section (11) of section 107 or before issuance of the order under the said sub-section, whichever is earlier (Refer Section D above), in respect of any appeal filed in FORM GST APL-01or FORM GST APL-03, file an application for withdrawal of the said appeal by filing an application in FORM GST APL-01/03W:
Provided that where the final acknowledgment in FORMGST APL-02has been issued, the withdrawal of the said appeal would be subject to the approval of the appellate authority and such application for withdrawal of the appeal shall be decided by the appellate authority within seven days of filing of such application:
Provided further that any fresh appeal filed by the appellant pursuant to such withdrawal shall be filed within the time limit specified in sub-section (1) or sub-section (2) of section 107, as the case may be.”
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Disclaimer: We have taken due care to the best of our knowledge while explaining the provisions surrounding the issue purely for informational/academic purpose. It should not be considered as professional advice or consultancy to be relied upon. Further, Fab Gyan and its Team will not be responsible for any mistake.