• Notification Date: 23-05-2024
• Notification No: N/A

All Benches of GSTAT will be Active from January 2025

The government intends to operationalise all the benches of GST Appellate Tribunal (GSTAT) by January 2025, as it aims to alleviate the significant backlog of pending GST-related disputes at the appellate level, according to a source. The principal bench of GSTAT, in New Delhi, is expected to start functioning from July, the source added. 

On May 6, Finance Minister Nirmala Sitharaman administered the oath to Sanjaya Kumar Mishra, former chief justice of Jharkhand High Court, as the President of the GSTAT. A press release issued by the finance ministry had said: “Mishra’s appointment marks the beginning of the operationalisation of the GSTAT, a crucial body for resolving GST-related disputes.” 

As many as 14,227 appeals against disputed tax demands raised by Central GST authorities were pending as of June 2023, a response by the finance ministry to the Parliament had revealed. 

“The expeditious operationalization of GSTATs is crucial to bolster assessee’s confidence in the overall judicial system,” said Krishan Arora, Partner, Grant Thornton Bharat. “It would help mitigate overall litigation time and costs, as many assessees were directly approaching High Courts for seeking relief in absence of operational GSTATs and many times courts refused to hear such matters,” he said. GSTAT is the appellate authority established under the Central GST Act, 2017, to hear various appeals against the orders of the first appellate authority. It consists of a Principal Bench, in New Delhi, and various state benches. As per the approval of the GST Council, the government has notified 31 state benches at various locations across the country.  

The process for appointment of judicial members and technical members is in progress. 

Judicial members within GSTATs are individuals with a background in law and judicial experience, often serving or retired judges. Their role is to provide legal expertise, interpret laws and regulations, and ensure that appeals are adjudicated in accordance with legal principles and precedents. Technical members, meanwhile, are experts in fields such as taxation, finance, accounting, or economics. They contribute to the tribunal’s deliberations, offering insights into the technical aspects of GST laws, calculations, and industry practices.  

“The combination of judicial and technical expertise within GSTATs should ensure a comprehensive and balanced approach to resolving GST-related appeals,” said Ankur Gupta, Practice Leader-Indirect Tax at SW India. 

Gupta says that GSTATs can enhance the speed of appeal resolution through implementing efficient case management systems and procedural rules to expedite the processing of appeals, and by leveraging technology to streamline administrative tasks and facilitate electronic communication between the tribunal, appellants, and tax authorities. 

Moreover, amid the ongoing process of appointments in GSTAT, experts say the government needs to clarify that the “limitation period” for filing appeals would not expire.  

As per the CGST (9th Removal of Difficulties) Order 2019, it was prescribed that the limitation period for filing of appeals to GSTAT will start from the date the president of the GSTAT “enters office”.  

“Now, even though appointments of other Judicial and Technical Members (as well as the requisite physical and IT infrastructure) remain pending, one could conceivably argue that the president of GSTAT has ‘entered office’. Unless the GSTAT starts functioning effectively at the earliest, limitation periods for filing appeals could technically expire leading to unnecessary stress for taxpayers and avoidable litigation,” said Sudipta Bhattacharjee, Partner at Khaitan & Co.