Appeal process under GST Act

OR
How to avoid Appeal under GST
OR
Facts about Appeals and Revisions under GST Act and ways
to interpret different section of the act along with facts of
your case to get the due justice at low cost and efforts
OR
Learn to avoid the appeals under GST act

Introduction;
Obligations of the tax payers and their compliances is being verified by the
tax officer regularly and/or frequent intervals, 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 by the process of legal remedy called appeals and revisions.

Tax law recognizes that on any given set of facts and laws, there can be
different opinions or viewpoints. Hence, it is likely that the taxpayer may not
agree with the “adjudication order” so passed by the tax officer. It is equally
possible that the Department may itself not be in agreement with the
adjudication order in some cases. It is for this reason that the statute
provides further channels of appeal, to both sides.

First I prefer to give you the facts about appeals and revisions in a table so
that the reader can understand the maximum facts about it before taking an
entry to interpret it with different sections of the act so as to enable them to
select an right channel, best suited to them.

Table:1

Appeal by the Tax payer/ dealer against the orders of the

Assessing Authority/ Adjudicating Authority
Query in respect of appeal by Tax Response as provided in the law
payers before AA
Relevant Provisions Section 107

_______________________________________________________________________
Page 1 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
 Time limit for filing appeal 3 months from the date of
communication of the decision or
order
Further 1 month for condolence.
Conditional payment(s) if any Accepted liability (tax, interest,
penalty, fees etc.) plus 10% on
disputed tax liability.
Requirement of stay against Automatic stay of recovery
recovery proceedings proceedings on payment of
conditional payment being
acknowledged
No of adjournment can be granted 3
by Appellate Authority
Time limitation to pass the orders Normally not more than 1 year
by the Appellate Authority
Nature of order to be passed by Speaking order and AA has no
Appellate Authority power to remand the appeal to AO
Probable outcome of the decision or AA can pass order confirming,
the Appellate Authority modifying or annulling the
decision and shall not remand the
order to AO who has passed the
order.

Whether the Appellate Authority can Yes, subject to show-cause notice

increase the liability in the decision and opportunity to hear the same
to be made by the appellant as required u/s
73 and 74
Form No, APL-01

Table: 2
Application by the Revisional Authority (RA) against the
orders of the Assessing authority/ Adjudicating Authority
Query in respect of appeal by
Revisional Authority before Response as provided in the law
Appellate Authority
Relevant Provisions Section 108
Time limit for filing appeal 6 months from the date of
communication of the decision or
order
Further 1 month for condolence.
_______________________________________________________________________
Page 2 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
 Requirement of stay against Automatic stay on operation of the
recovery proceedings decision issued by Adjudicating
Authority.
No of adjournment can be granted 3
by Appellate Authority
Time limitation to pass the orders Normally not more than 1 year
by the Appellate Authority
Nature of order to be passed by Speaking order and Appellate
Appellate Authority. Authority has no power to remand
the appeal to AO
Probable outcome of the decision or AA can pass order confirming,
the Appellate Authority modifying or annulling the
decision and shall not remand the
order to AO who has passed the
order.

Whether the Appellate Authority can Yes, subject to show-cause notice

increase the liability in the decision and opportunity to hear the same
to be made by the appellant as required u/s
73 and 74
Form No, APL-03

Table: 3
Appeal by the Tax payer/ dealer against the orders of the
Appellate Authority before Appellate Tribunal
Query in respect of appeal by Tax Response as provided in the law
payers before Appellate Tribunal
Relevant Provisions Section 112/113
Time limit for filing appeal 3 months from the date of
communication of the decision or
order
Further 1 month for condolence.
Ceiling on the dispute Not less than Rs.50,000/- (Note:
The phrase used here is may
refuse and hence it is the
discretion of Appellate Authority)
Fee for the appeal 1% on the dispute subject to
maximum of Rs. 25,000/- for
CGST and Rs.25000/- for SGST or
UTGST or Rs.50,000 under IGST.
_______________________________________________________________________
Page 3 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
 Conditional payment(s) if any Accepted liability (tax, interest,
penalty, fees etc.) plus 20% on
disputed tax liability.
Requirement of stay against Automatic stay of recovery
recovery proceedings proceedings on payment of
conditional payment
Requirement of Cross objections to 45 days
be filed by Revisional Authority
Probable outcome of the decision or Appellate Tribunal may pass order
the Appellate Tribunal confirming, modifying or annulling
the decision and may remand the
order to Appellate Authority or
Adjudicating Authority with such
direction(s).
No of adjournment can be granted 3
by Appellate Authority
Form No, APL-05

Table :4
Application by the Revisional Authority against the orders of
the Appellate Authority before Appellate Tribunal
Query in respect of appeal by
Revisional Authority before Response as provided in the law
Appellate Tribunal
Relevant Provisions Section 112/113
Time limit for filing appeal 6 months from the date of
communication of the decision or
order. Further 1 month for
condolence.
Ceiling on the dispute Not less than Rs.50,000/- (Note:
The phrase used here is may refuse
and hence it is the discretion of
Appellate Authority)
Requirement of stay against Automatic stay of recovery
recovery proceedings proceedings on payment of
conditional payment
Requirement of Cross objections to 45 days
be filed by Respondent/ Tax payer
No of adjournment can be granted 3
by Appellate Authority
Form No, APL-07
_______________________________________________________________________
Page 4 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
Comparison with earlier VAT act appeal process;

(i) Every state has its own standards in accepting conditional payment
ranging from 12.5% to 50% of the disputed tax and other charges besides
fee for the application with appellate authority and before Appellate
Tribunals. When it comes to GST the conditional payment is just 10% of the
disputed tax only and not on disputed interest, penalty etc.

(ii) Time limit for filing an appeal against the orders of the Assessing
Authority/ Adjudication Authority with Appellate Authority is only 30 days
in most of the sate VAT acts, but now it is 3 months under the present GST
acts.

(iii) Secondly, the time limit available for the appellate authority to pass the
order is 1 year and number of adjournment can be claimed by the parties in
the appeal is restricted to 3 only, when it comes to earlier vat regime there
was no such restrictions in general.

(iiv) Interestingly the department has the power to go for an appeal before
the Appellate Authority against the orders of the Adjudicating Authority or
Assessing Authority under GST act unlike the earlier VAT Act, which can be
termed to be major disadvantage under GST as compared to earlier vat
regime.

General points:
Appellate Tribunal constituted in two tier Tribunals consisting of National
level Bench and State level bench. Disputes in respect of place of supply will
be referred to National level bench and disputes other than place of supply
will be referred to State level Bench. Appeal against the decision of National
level bench lies with Supreme Court as the simple logic is the place of
supply will mostly fall outside the state where in the local high court do have
jurisdictional powers to address the disputes. And appeal against the
decision of State level Bench lies with High court of the respective state.

The procedure for appeal with state High Court and Central Supreme Court
will be as required under the provisions of Code of Civil Procedure 1908 (5 of
1908).

If the decision is awarded in favour of the dealer, interest at the rate of 9%

for the period in excess of 60 days, will be paid along with the conditional
deposit, if any, made by the tax payer as provided under the provisions of
the appeal.

_______________________________________________________________________
Page 5 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
Interpretation with Section 161 which relates to
Rectification of errors apparent on the face of records with
Section 107 which relates to appeal before Appellate
Authority;

If the tax payer felt that the orders passed by the Adjudicating Authority or
Assessing Authority is unreasonable and it lacks enforceability owing to the
mistakes on the assessment proceedings or on the grounds of mathematical
errors or on the grounds of procedural lapse under the laws which can be
brought in to the ambit of errors apparent on the face of the records, it is of
my opinion that the tax payer need not take up the matter with Appellate
Authority with conditional payment of 10% of disputed tax instead the
dealer can take up the matter with the authority who has passed the order
for rectification of mistakes under section 161 of CGST act, quoting the valid
reasons/ valid case studies in support of his conclusion, where in the dealer
need not pay conditional payment of 10% of the disputed liability. This is
the cost effective mode to the dealers, who do have substantial grounds to
substantiate their statement in support of their fact that the orders passed
by the authority need to be rectified under section 161 of the act as the
issue relates to rectification of errors apparent on the face of the records and
in the absence of a proper supportive case studies and grounds, the decision
deserves to be appealed before Appellate Authority or Appellate Tribunal or
so. It is pertinent to state that every case and its facts has its own
differential dimensions to prove that the issue is falling under section 161
which requires to be rectified by the same authority who has passed the
order.

Here the condition is the affected dealer has to take up the matter with the
authority who has passed the order with in a period of 3 months and the
adjudicating authority has to pass the fresh order with 6months from the
date of communication of the earlier order. The limitation of 6 months noted
above will not applicable for the rectification which are/is purely in the
nature of correction of a clerical or arithmetical error, arising from any
accidental slip or omission. Further the adjudicating authority cannot
increase the liability in the same order as it will be termed to be violation of
natural justice and hence the authority will follow the principles of natural
justice while carrying out such rectification.

_______________________________________________________________________
Page 6 of 7 of Article on Appeals and Revisions by P Jagadeeswaran
Conclusion:
Considering the facts noted under the heading “Interpretation with Section
161 which relates to Rectification of errors apparent on the face of records
with Section 107 which relates to appeal before Appellate Authority”, in the
previous page(s), it is suggested that the tax payer need to carefully read all
the phrases in conjunction with the facts of their case read with the relevant
provisions of the act along with the estimated cost of the legal remedy to get
a proper justice and then to proceed to fetch the right and due justice due
as provided under the relevant article(s) of the constitution, which are the
basics of the GST act.

Disclaimer: The readers are informed to note that the facts and information’s stated
in this article is extracted from different provisions and summarized for the purpose
of presentation and this itself cannot be assumed to be a legal opinion. For any
specific requirement of legal opinion on the facts of the case, the reader may reach
the author for professional support.

The author is a Practitioner under GST act and under earlier VAT acts
of multiple states in the country. One of the authors for the book
published in the name of “Simplifying Multi State VAT on Works
Contracts” in 2015-16 & 2016-17, authored by 23 leading eminent
CA’s & Advocates in the country and can be reached at

P.Jagadeeswaran, Partner,

Laws Reward Solutions

GST/ VAT/ IT Practitioners & Consultants, Project Finance Management Consultants
No.33, Elango St., Chelliamman Nagar, Athipet, Ambattur, Chennai – 600058.
Branch @ 21, A K T St, Near Asthabujaperumal Koil, Kancheepuram – 631501.
Mobile: 9840746721/9176038176,
email : eswaran60@yahoo.com, eswaran1960@gmail.com

_______________________________________________________________________
Page 7 of 7 of Article on Appeals and Revisions by P Jagadeeswaran