Pradeep Jain - Chartered Accountant

GST UPDATE-6.01.2017 FIRST APPELLATE AUTHORITY

GST DAILY DOSE OF UPDATION

SECTION 98 APPEALS TO FIRST APPELLATE AUTHORITY:- The provisions relating to filing of appeal to first appellate authority are discussed in this update. The earlier GST Law provided separate provisions for filing appeal under CGST/SGST but these provisions have been consolidated for better reference. Also, the disparity among the provisions under CGST and SGST law has been removed in the revised GST Law.

Any person aggrieved by any decision or order passed against him can file appeal to the first appellate authority within three months from the date on which the said decision or order is communicated to such person. However, it is provided that if the appeal is filed by revenue authorities, the time limit for filing appeal is six months from the date on which decision or order is communicated for filing appeal. Furthermore, it is also provided that if the appeal has not been filed within prescribed period of three/six months, the first appellate authority may allow it to be presented within a further period of one month.

The analysis of the above provisions reveals that the revised GST law seeks to provide a longer time period for filing appeal to the first appellate authority in case the appeal is filed by the revenue authorities. This will have adverse impact and will encourage careless attitude of revenue authorities to file appeal. Presently, there is same time limit for filing appeal and it should be continued in the proposed GST regime also so that there is equal time limit for challenging an order or decision either by assessee or by the revenue department.

The provisions regarding mandatory pre-deposit have also been drastically changed. According to therevised GST Law, the amount of tax, interest, fee and penalty accepted by assessee is to be paid in full and further an amount of 10% of the amount of tax in dispute is also to be paid as mandatory pre-deposit for filing appeal to first appellate authority. Not only this, departmental authorities will have right to apply to the First Appellate Authority for ordering a higher amount of pre-deposit not exceeding twenty five per cent of the amount of tax in dispute in case considered by the Commissioner of GST as a ‘serious case’. Moreover, explanation clarifies the meaning of ‘serious case’ as case involving a disputed tax liability of not less than Rs. 25 Crores.
If we observe the mandatory pre-deposit provisions presently in force in Central Laws, we find that there is a ceiling of Rs. 10 Crores but no such ceiling is there in the revised GST Law. Moreover, discretionary power has been granted to departmental authorities for ordering higher pre-deposit in cases considered as ‘serious case’ by the Commissioner. This provision was expected to be deleted in the Revised GST Law but this has not been done which is great disappointment for assessees. The Revised GST Law has only reduced the extent of pre-deposit from 50% of the amount in dispute to 25% of the amount of tax in dispute. The basic purpose of introducing mandatory pre-deposit provisions was to reduce the burden of appellate authorities and reduce the wastage of time in deciding stay applications. However, incorporating discretionary power to order higher pre-deposit will again lead to increasing the burden of appellate tribunals in deciding the quantum of pre-deposit.

If the old GST Law is studied, it was found that the first appellate authority was empowered to pass such order as he thinks just and proper, confirming, modifying or annulling the decision or order appealed against. However, under the Revised GST Law, it is specified that the first appellate authority shall pass such order as he thinks just and proper, confirming, modifying or annulling the decision or order appealed against but shall not refer the case back to the authority that passed the said decision or order. Hence, the first appellate authority will not have power to remand the case in GST regime.

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GST UPDATE-6.01.2017 FIRST APPELLATE AUTHORITY

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