Appeal under GST section: Appeal and Revision Mechanism under GST
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The existence of an effective multi-level appellate mechanism under the GST helps provide justice and addresses the grievances of both the taxpayers and the department. The system outlined in the Central Goods and Services Tax Act of 2017 and the associated rules and notifications recognized a fairly structured process for redress between adjudication, appeal, and revision, culminating in one of the High Courts and in some instances, reaching the Supreme Court.
This article focuses on appeal under GST section: Appeal and Revision Mechanism under GST, exploring the various statutory appeal and revision provisions with section-wise references, applicable forms, procedures, time limits, and key judicial interpretations.
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First Level Appeal Before Appellate Authority (Section 107 of CGST Act)
Who Can File?
Under Section 107(1), any person aggrieved by an order or decision of an adjudicating authority (including SGST/UTGST authorities) may file an appeal before the Appellate Authority. This appeal must be filed within 3 months (90 days) from the date of communication of the impugned order.
Who Are the Appellate Authorities?
As per Rule 109A of the CGST Rules, the hierarchy is as follows:
- Commissioner (Appeals): For decisions made by Additional or Joint Commissioners.
- Joint Commissioner or higher rank (Appeals): For orders issued by lower officers like Assistant/Deputy Commissioner or Superintendent.
The objective is to provide an appellate forum proportionate to the authority of the original order.
Pre-Deposit Requirements Before Filing Appeal
Section 107(6) mandates a two-fold pre-deposit:
- Full payment of admitted liability.
- 10% of the disputed tax amount, capped at ₹25 crores (₹50 crores in IGST cases).
🔒 Once this amount is deposited, recovery proceedings are automatically stayed, giving relief to the taxpayer during the pendency of the appeal.
📄 Procedure to File Appeal (Rule 108)
Filing Process:
- Appeal must be filed in Form GST APL-01 (for taxpayer) or APL-03 (for department).
- A provisional acknowledgment is issued immediately upon filing.
- The certified copy of the impugned order must be submitted within 7 days.
- If delayed, the date of submission becomes the effective date of appeal.
Electronic Filing & Signature Verification:
- All documents must be filed electronically through the GST portal.
- Appeals must be verified using a Digital Signature Certificate (DSC) in compliance with the Information Technology Act, 2000.
Condonation of Delay:
- The Appellate Authority has the discretion to condone delay in filing for up to one additional month, provided sufficient cause is shown.
🔍 Conduct of Proceedings Before Appellate Authority
Hearing Procedure:
- Both parties (appellant and respondent) must be given a reasonable opportunity of being heard.
- A maximum of 3 adjournments may be granted during the course of hearing.
Additional Grounds & Evidence:
- The authority may allow the introduction of additional grounds of appeal, provided their omission earlier was not deliberate.
Nature of Order:
The Appellate Authority may:
- Confirm, modify, or annul the order.
- Cannot remand the case back to the adjudicating officer.
- Orders enhancing penalties or reducing refunds require prior notice and opportunity to respond.
Timelines:
- Aim is to decide appeals within 1 year from the filing date, excluding periods of court-ordered stay.
🔄 Revision Mechanism under Section 108 of CGST Act
Who is the Revisional Authority?
- Principal Commissioner or Commissioner for orders passed by Joint/Additional Commissioners.
- Joint/Additional Commissioner for orders passed by lower authorities.
Powers and Scope:
The Revisional Authority can suo moto, or upon request, examine records and revise orders if they are:
- Erroneous, illegal, or improper, or
- Prejudicial to the interest of revenue.
However, no revision can be initiated if:
- The order is already under appeal,
- The revision was already conducted earlier, or
- More than 3 years have passed (subject to exclusions like litigation periods).
Format of Orders:
- The proceedings begin with a notice in Form RVN-01.
- Final order is passed in Form APL-04.
⚖️ Currently, taxpayers cannot initiate revision—a limitation highlighted by experts as contrary to the principles of equity.
🏛️ Second Appeal to GST Appellate Tribunal (Section 112)
Who Can File?
Appeals against orders of the Appellate Authority or Revisional Authority lie with the GST Appellate Tribunal, to be filed within 3 months (taxpayer) or 6 months (department).
Key Highlights:
- Tribunal may refuse to admit appeals if the disputed amount is below ₹50,000.
- Tribunal may condone delay up to 3 months (appeals) or 45 days (cross-objections).
- Filing is done in Forms APL-05, APL-06, and APL-07 depending on appellant/respondent/department.
Pre-Deposit:
- Must pay:
- 100% of admitted liability
- Plus 20% of disputed tax, up to ₹50 crore (₹100 crore for IGST), in addition to previous deposits under section 107.
Appeal Fee:
- ₹1,000 per ₹1 lakh of dispute, max ₹25,000. No fee for rectification applications.
📋 Tribunal Proceedings (Section 113)
- Tribunal may confirm, modify, annul, or remand the order to original authority.
- Proceedings are to be completed within 1 year of filing.
- May rectify any error apparent on the record within 3 months.
Orders are communicated to all parties and the relevant jurisdictional authorities.
⚖️ Constitution of Tribunal – Section 109 & 110
Tribunal Structure:
- National/Regional Benches (for issues involving place of supply)
- State/Area Benches (for other matters)
Bench Composition:
- Judicial Member
- Technical Member (Centre)
- Technical Member (State)
For small appeals (< ₹5 lakhs without a question of law), a single-member bench may decide.
Qualifications:
- President: Former Judge of Supreme Court/High Court
- Judicial Member: Judge or qualified legal professional
- Technical Members: Senior officials from CBIC or SGST departments
🤝 Authorized Representatives (Section 116)
Eligible representatives include:
- Regular employee or relative
- Practicing Advocate
- CA/CMA/CS with valid practice certificate
- Retired tax officers (after cooling period)
- Authorized GST practitioners
❌ Non-Appealable Orders – Section 121
Certain administrative decisions are non-appealable, such as:
- Transfer of proceedings
- Seizure/retention of documents
- Sanction of prosecution
- Payment in instalments under Section 80
⚖️ High Court Appeal – Section 117
Appeal from the State/Area Bench of Tribunal to High Court on substantial question of law:
- Filed in Form APL-08 within 180 days.
- Bench of minimum two Judges hears the appeal.
⚖️ Supreme Court Appeal – Section 118
Appeal lies to the Supreme Court:
- Directly from National/Regional Benches of Tribunal, or
- From High Court judgment with appropriate certification.
💸 Refund of Pre-Deposit – Section 115
Refund of pre-deposit (10% or 20%) is allowed with interest under Section 56, from payment date till refund date, if appeal is decided in taxpayer’s favour.
🚧 Challenges in Tribunal Constitution
Due to non-constitution of Tribunals in many states, appellants are in limbo. The Madras High Court in Revenue Bar Association vs UOI struck down some provisions of Sections 109 & 110, and suggested legal reforms to include practicing advocates in the Tribunal and remove unconstitutional barriers.
📑 Removal of Difficulties & Clarifications
- CGST Order No. 09/2019: Timeline to file appeal starts from date Tribunal President assumes office.
- CBIC Circular 132/2020: Appellate Authorities should dispose cases without waiting for Tribunal formation.
🏛️ Writ Petition to High Court in Absence of Tribunal
In M/s A.B. Enterprises vs State of UP, the Allahabad High Court ruled that in absence of Tribunal, appeal timeline shall be governed as per Order 09/2019, allowing petitioners to preserve their appellate rights.
🧾 Final Tax Demand Confirmation (Rule 115)
When appeals conclude, the jurisdictional officer shall issue a final demand statement in Form APL-04, showing the tax confirmed by the High Court or Supreme Court.
🧠 Conclusion and Suggestions
- Pre-deposit is only on disputed tax, ensuring fair access to appellate forums.
- Time limitations and restricted condonation powers need flexibility for equitable justice.
- Taxpayers should also be allowed to seek revision of orders—not just the department.
- Immediate constitution of GST Appellate Tribunals is essential for justice delivery.