Ministry of Finance on 14th September, 2023 has finally notified 31 benches of GSTAT situated all over India. So we can now finally say that GSTAT is a reality and has seen its Day. (Copy of the Notification is attached at the end of the Article).
In this article, we will discuss everything about GSTAT 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.
Tax laws (or any laws, for that matter) impose obligations. Such obligations are broadly of two kinds: tax-related and procedure-related. The taxpayer’s compliance with these obligations is verified by the tax officer (by various instruments such as scrutiny, audit, anti-evasion, etc.), as a result of which sometimes there are situations of actual or perceived non-compliance. If the difference in views persists, it results into a dispute, which is then required to be resolved.
Therefore, to resolve the disputes between Department and the Taxpayer, various appellate platforms have been created by the Statute. GSTAT is the second level of Appellate platform after Appellate Authority (commonly known as Office of the Commissioner Appeals) / Revisionary Authorities as established under Section 107 & Section 108 of CGST Act respectively. Further, GSTAT established under Section 109 of CGST Act is the first platform which is not manned by the Departmental officials.
Area Covered in the Article:
A. Orders which can be Appealed in the GSTAT (Section 112)
(a) Any order passed by the Appellate Authority (established under Section 107 of CGST Act commonly known as office of the Commissioner Appeal) or Revisionary Authority (Notified vide Notification No. 5/2020 dated 13th January, 2020 under Section 108 of CGST Act) can be appealed in the GSTAT.
(b) Appeal with the GSTAT can be filed by the Aggrieved Party who can either be the Department or the Taxpayer.
(c) Time Line to file appeal in GSTAT is Three months from the date of communication of the order. (Not the date of order) for the Assessee.
(d) Time Line to file appeal in GSTAT is Six months from the date of the order for the Department. Commissioner can direct officer subordinate to him to file appeal with GSTAT.
(e) Since, GSTAT was not established, therefore these three months/six months will be calculated from day of communication of order or the day on which President/State President will enter the office of GSTAT whichever is later (CGST (Ninth Removal of Difficulties) Order, 2019 issued under C.B.I. & C. Order No. 9/2019-C.T., dated 3.12.2019)
(f) GSTAT can condone the delay in filing of Appeal by three months if it is satisfied that there was sufficient cause for not presenting it within that period.
(g) GSTAT can refuse the appeal where amount involved is less than or equal to Rs.50,000/-.
B. Concept of Pre-Deposit & Refund of it (Section 112 & 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 Appellate Authority/Revisionary Authority as per details below:
(a) 100% of Tax, interest, penalty & fine which is admitted by the Taxpayer.
(b) 20% of the Remaining Tax Amount which is disputed (here interest, penalty, fine is not there as Tax itself is disputed) in addition to the amount he has already deposited while filing appeal with the Office of Commissioner Appeal (which is 10% of Tax amount). Maximum amount required is Rs. 50 Crores.
(c) Where Taxpayers deposited aforesaid amount, recovery proceedings for balance amount of tax amount as confirmed by Appellate Authority will be deemed to be stayed till the disposal of Appeal.
(d) Where Pre-Deposit Amount is required to be refunded consequent to any order of the GSTAT, 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 Appeal with GSTAT (Rule 110 & 111)
(a) An appeal to the GSTAT shall be filed by the Taxpayer along with the relevant documents either electronically or otherwise in FORM GST APL-05, on the common portal and a provisional acknowledgement shall be issued to the appellant immediately. Thereafter, certified copy of the decision or order appealed against shall be submitted to the Registrar within seven days of the filing of the appeal and a final acknowledgement shall be issued thereafter in FORM GST APL-02 by the Registrar. (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) The fees for filing of appeal shall be Rs. 1000 for every one lakh rupees of tax or input tax credit involved or the difference in tax or input tax credit involved or the amount of fine, fee or penalty determined in the order appealed against, subject to a maximum of twenty-five thousand rupees.
(d) Appeal by the Department (Technically called as Application under Rule 111) will be filed in the Form GST-APL-07 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. Procedure to be Adopted by GSTAT (Section 111,112, Rule 110)
(a) The party against whom the appeal has been preferred may file within forty-five days of the receipt of notice, a memorandum of cross-objections in GST-APL 06, verified in the prescribed manner, against any part of the order appealed against. Such Period of 45 days can further be extended by another 45 days by GSTAT.
(b) The GSTAT shall not, be bound by the procedure laid down in the Code of Civil Procedure, 1908, but shall be guided by the principles of natural justice.
(c) The GSTAT shall have power to regulate its own procedure subject to the other provisions of this Act and the rules made thereunder.
(d) All proceedings before the GSTAT shall be deemed to be judicial proceedings.
E. Admissibility of Additional Evidences before GSTAT (Rule 112)
The appellant shall not be allowed to produce before the GSTAT any evidence, whether oral or documentary, other than the evidence produced by him during the course of the proceedings before the adjudicating authority or, the Appellate Authority except in the following circumstances, namely
(a) where the adjudicating authority (the first authority which decide the fate of SCN) or, as the case may be, the Appellate 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, as the case may be, the Appellate Authority; or
(c) Where the appellant was prevented by sufficient cause from producing before the adjudicating authority or, as the case may be, the Appellate Authority any evidence which is relevant to any ground of appeal; or
(d) where the adjudicating authority or, as the case may be, the Appellate 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 or the Appellate Tribunal records in writing the reasons for its admission.
The GSTAT 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 or the Appellate Tribunal to direct the production of any document, or the examination of any witness, to enable it to dispose of the appeal.
F. Concept of Authorised Representative (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.
G. Order of GSTAT (Section 113)
(a) The Appellate Tribunal may, confirm, modify or annul the decision or order appealed against or
(b) Refer the case back to the Appellate Authority, or the Revisionary Authority or to the original adjudicating authority, with such directions as it may think fit, for a fresh adjudication or decision after taking additional evidence, if necessary.
(c) GSTAT can adjourn the hearing also but not more than three times during hearing of appeal.
(d) GSTAT 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) The jurisdictional officer shall issue a statement in FORM GST APL-04 clearly indicating the final amount of demand confirmed by the GSTAT (Rule 113).
H. Appeal Against the Order of GSTAT (Section 117 & 118)
(a) Order of State benches of GSTAT can be appealed before High Court if it involves substantial question of Law. Appeal can’t be filed for Question of fact.
(b) Time Period for filing appeal with High Court is 180 days. (High Court can condone the delay).
(c) Appeal in High Court will be heard by the bench having at least two Judges.
(d) It is to be noted that Order of Principal bench of GSTAT will be heard by the Supreme Court directly.
(e) It is to be noted that it is mandatory for the Principal Bench of GSTAT to hear the case which involves question of Place of Supply.
Copy of the Notification
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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.