Understanding Appeals and Revision under CGST Act: A Comprehensive Guide to Sections 107-121

Based on the sources provided, Chapter 19 of the Central Goods and Services Tax Act, 2017 (CGST Act) deals with Appeals and Revision, covering Sections 107 to 121. These provisions establish a structured hierarchy and procedure for taxpayers and tax authorities to appeal decisions made by adjudicating authorities.

Key Definitions and Authorities

Before delving into the specific sections, it's important to understand the key authorities involved in the appeals and revision process as defined in the sources:

• Adjudicating Authority: This is any authority appointed or authorised to pass an order or decision under the CGST Act. However, it explicitly excludes the Revisional Authority, the Appellate Authority, and the Appellate Tribunal.

• Appellate Authority: An authority specifically appointed or authorised to hear appeals as referenced in Section 107 of the CGST Act.

• Revisional Authority: An authority appointed or authorised for the revision of decisions or orders as referred to in Section 108.

• Appellate Tribunal: This refers to the Goods and Services Tax Appellate Tribunal (GSTAT) constituted under Section 109.

Appeals to the Appellate Authority (Section 107)

Any person, including a taxpayer, who is aggrieved by a decision or order from an adjudicating authority can file an appeal with the Appellate Authority.

• Time Limit: The appeal must be filed within three months from the date the decision or order is communicated. The Appellate Authority has the discretion to allow a further period of one month if sufficient cause for the delay is shown.

• Departmental Appeals: The Commissioner can also initiate an appeal on their own motion or upon request from a State/Union Territory Commissioner if they believe an order is improper or illegal. This must be done within six months from the date of communication of the order.

• Pre-deposit Requirement: To file an appeal, the appellant must pay:

    ◦ The admitted amount of tax, interest, fine, fee, and penalty in full.

    ◦ A sum equal to 10% of the remaining amount of disputed tax, subject to a maximum of twenty crore rupees.

    ◦ For appeals against orders related to the detention, seizure, and release of goods and conveyances in transit (Section 129), the pre-deposit is 25% of the penalty amount.

• Stay on Recovery: Once the pre-deposit is paid, recovery proceedings for the balance amount are automatically stayed.

• Procedure and Orders:

    ◦ The Appellate Authority must provide an opportunity for the appellant to be heard.

    ◦ It can confirm, modify, or annul the original order but cannot remand the case back to the adjudicating authority.

    ◦ If the authority opines that tax has been short-paid, not paid, or erroneously refunded, or ITC has been wrongly availed, it must issue a show-cause notice to the appellant, and the order must be passed within the time limits specified under Section 73 or 74.

    ◦ The order should be passed, wherever possible, within one year from the date of filing the appeal.

Powers of the Revisional Authority (Section 108)

The Revisional Authority has the power to examine proceedings of any subordinate officer to ensure legality and propriety, especially if an order is prejudicial to revenue.

• Initiation: This can be done on the authority's own motion, based on information received, or upon request from a State/UT Commissioner.

• Powers: The authority can stay the operation of the order and, after giving the person concerned an opportunity to be heard, can enhance, modify, or annul the decision.

• Limitations: The Revisional Authority cannot exercise its power if:

    ◦ The order is already under appeal under Sections 107, 112, 117, or 118.

    ◦ The time limit for a departmental appeal (six months under Section 107) has not expired, or more than three years have passed since the order.

    ◦ The order has already been subject to revision.

• Finality: The order passed in revision is final and binding, subject to further appeals to the Appellate Tribunal or courts.

The Goods and Services Tax Appellate Tribunal (GSTAT) (Sections 109-113)

The GSTAT is established to hear appeals against orders from the Appellate Authority or the Revisional Authority.

• Constitution (Section 109):

    ◦ The Government will establish a Principal Bench in New Delhi and State Benches at the request of states.

    ◦ The Principal Bench will consist of the President, a Judicial Member, a Technical Member (Centre), and a Technical Member (State). State Benches consist of two Judicial Members, a Technical Member (Centre), and a Technical Member (State).

    ◦ Crucially, cases involving the place of supply as an issue can only be heard by the Principal Bench.

• President and Members (Section 110): This section details the qualifications, appointment process, and conditions of service for the President and Members of the GSTAT.

• Procedure (Section 111): The Tribunal is not bound by the Code of Civil Procedure, 1908, but must be guided by the principles of natural justice. It has the powers of a civil court for purposes like summoning witnesses and compelling the production of documents.

• Appeals to the Appellate Tribunal (Section 112):

    ◦ An aggrieved person can appeal an order from the Appellate or Revisional Authority within three months of the order's communication.

    ◦ The Tribunal can condone a delay of up to three months.

    ◦ The pre-deposit required is 10% of the remaining disputed tax amount (in addition to the 10% paid for the first appeal), subject to a maximum of twenty crore rupees.

    ◦ Once this pre-deposit is made, recovery of the balance amount is deemed to be stayed.

• Orders of the Appellate Tribunal (Section 113):

    ◦ The Tribunal can confirm, modify, or annul the order under appeal and also has the power to remand the case back to the Appellate Authority, Revisional Authority, or the original adjudicating authority. This is a key difference from the powers of the first Appellate Authority.

    ◦ The order should be passed, where possible, within one year from the date of filing the appeal.

Further Appeals and Related Provisions

• Appeal to High Court (Section 117): An appeal from an order of the State Bench of the GSTAT can be filed with the High Court if it involves a substantial question of law. The appeal must be filed within 180 days.

• Appeal to Supreme Court (Section 118): An appeal lies with the Supreme Court from any judgment or order passed by the Principal Bench of the GSTAT or a High Court order that is certified as fit for appeal.

• Interest on Refund of Pre-deposit (Section 115): If an amount paid as a pre-deposit for an appeal under Sections 107 or 112 becomes refundable, interest at the rate specified under Section 56 (not exceeding 9%) is payable from the date of payment until the date of refund.

• Non-Appealable Orders (Section 121): No appeal can be filed against certain administrative orders, such as orders transferring proceedings, seizing or retaining books of account, sanctioning prosecution, or orders for payment in instalments under Section 80.

• Link with Other Sections: Orders from appellate authorities can impact other processes. For instance, when a refund arises from an appellate order, specific documentary evidence like the reference number and a copy of the order are required for the refund application. Similarly, demands reduced due to appellate orders affect the apportionment of Integrated Tax.

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