GST Appellate Tribunals to face tsunami of appeals worth ₹1 lakh crore


Sources share that “the government expects the Appellate Tribunals to be functional by April 2024.” It is understood that both the government and the industry aim to ease the litigation burden on the High Courts in the country once these Appellate Tribunals come into existence.

The government notified the creation of GST Appellate Tribunals on October 27, 2023.

Sources further share that “the industry is likely to file appeals in large numbers against adverse GST orders. However, the industry has requested the government to consider reducing the amount of the pre-appeal deposit.”

“The industry, in a representation, has mentioned that a high pre-appeal deposit amount will hurt the working capital for many firms,” sources said.

GST assesses pay 30% of the GST demand as a pre-appeal deposit before filing an appeal. The maximum pre-appeal deposit in cases with high-value CGST has been increased to₹50 crore from the pre-GST limit of ₹25 crore.

Similarly, the maximum pre-appeal deposit in cases with high-value IGST has been increased to ₹100 crore. The government aims to have 32 benches of GST Appellate Tribunals in the first phase.

These 32 GST Appellate Tribunal benches will include one national bench and 31 state benches. Large states will have 2 benches, and smaller states are likely to have combined benches.

“The government aims to double the number of state-level GST Appellate Tribunals to 62 in the second phase,” sources said. Experts say that the tribunals were much awaited and a need of the hour.

“The absence of a GST Appellate Tribunal even after 6 years of the GST law coming into force was a glaring gap in the GST administration. The government has slowly initiated the process of setting up the tribunal.

On September 14, the notification regarding the location of benches was issued, with 31 benches to be set up across various states. The government has now issued the notification on October 25, spelling out the appointment and conditions of service of the President and member rules.

This is a significant step forward, and the process of selection and filling up of the posts can now commence. Hopefully, the process will be completed, and the tribunals will start functioning soon,” said Najib Shah, former chairman of CBIC.

“The formation and operationalisation of the tribunals will assist those taxpayers who have pending litigations to be filed before the tribunal. Predeposit may become a hardship in cases of genuine tax disputes. As the tribunals will start with lot of pendency, the taxpayers will have to mention priority to get the matters listed”, the Advocate said, who argued before the High Courts for the statutory and constitutional right of the taxpayers to file these appeals in absence of the tribunal.

He also pointed out that the Bombay High Court has held that the time limit for filing the appeals before the tribunal will be counted from the day these tribunals will become operational. This order can help all the taxpayers all throughout the country, he noted.,,

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