Goods and Services Tax Appellate Tribunal

From Justice Definitions Project

What is GSTAT?

The Goods and Services Tax Appellate Tribunal (GSTAT) is a specialized appellate authority responsible for resolving disputes that arise under the GST (Goods and Services Tax) laws in India. It deals with matters related to GST and was established under Section 109 of the Central Goods and Services Tax Act, 2017[1].

GSTAT deals with a wide range of issues pertaining to GST, including tax disputes, appeals, and challenges arising from GST laws. It holds jurisdiction over matters referred to it under the GST Act.

GSTAT operates under the oversight of the Ministry of Finance, Government of India.

Historical Evolution

To implement the Goods and Services Tax, the 122nd constitutional amendment bill was introduced in the parliament and passed by both houses in August 2016. the bill being passed by 15 states, the president thereto gave his assent to the Constitution (One Hundred And First Amendment) Act, 2016 on the 8th of September, 2016.

For the smooth functioning of this tax, consultation, and cooperation between the centre and states are required, and the GST Council was established through the same amendment to facilitate this purpose.

The GST Council consists of the Union Finance Minister who acts as the chairperson, the union minister of State who is in charge of the revenue of finance, and the minister in charge of finance of taxation or any other minister nominated by each state government as members.

On 23rd January 2019, the union cabinet approved the creation of a national bench for GSTAT. This issue was then shifted to acquire assent by the GST council.

In its 49th meeting on 18th February 2023, the GST council approved the creation of a national bench of the goods and services tax appellate tribunal in principle. It was agreed to be situated at New Delhi and presided over by its president. It was also notified that the GSTAT will consist of two technical members, one from the state and one from the center.

On 14th September 2023, the Ministry of Finance notified 31 benches of the GST Appellate Tribunal which were to be set up in all states and Union Territories.

Legislative Framework

The primary governing legislation for GSTAT is the Central Goods and Services Tax Act, 2017[2], which establishes its authority and defines its functions.

Governance Structure:

Technical members of the Appellate Tribunal, in the context of the central government, are required to fulfill specific qualifications as outlined in Section 110 of the 2017 act[3].

They must either hold or have held a position in the Indian Revenue (Customs and Central Excise) Service, Group A, and have a track record of at least fifteen years of service within Group A.

On the other hand, for technical members appointed from the state government, Section 110 mandates that they hold a rank within the state government that is equal to or higher than the Additional Commissioner of VAT or State GST.

Alternatively, the state government may identify other specific ranks for this role based on recommendations from the council. Additionally, state-level technical members are required to possess a minimum of three years of practical experience in their designated roles.

Procedural Framework:

GSTAT operates in accordance with rules and procedures defined under the GST Act under Section 111 as per the Section, the tribunal is bound by the procedure laid down in the Code of Civil Procedure, 1908, but also guided by the principles of natural justice[4].

Distribution of Benches:

By a notification dated 14th September 2023, the Ministry of Finance, Department of Revenue, notified the number of benches per state as well as the location for all of these benches.

In an order dated 25th October 2023, the Department of Revenue under the Ministry of Finance enacted the "Goods and Services Tax Appellate Tribunal (Appointment and Conditions of Service of President and Members) Rules, 2023."

In Chapter Two of this notification, the appointment of the President and the members is delineated. The committee is allowed to issue and circulate a vacancy circular through the Member-Secretary. Furthermore, the committee scrutinizes every application received in response to the circular and shortlists eligible candidates for personal interaction.

For the position of President, the committee can either issue a vacancy circular or search for suitable persons and make an appointment.

The Ministry of Finance issued a notification dated 29th December 2023, numbered S.O. 1(E), regarding the constitution of the Principal Bench in New Delhi for GSTAT. This Principal Bench was constituted according to the powers granted in Section 109 (3) of the Central Goods and Services Tax Act, 2017[5].

Following, in the year 2024, there have been crucial events unfolding with regard to GSTAT. The notification S.O. 3048(E), issued on 31st July 2024, that the principal bench being constituted in New Delhi, the State Benches are constituted, which is provided in a detailed manner in the notification.

  • Wherein, it specifies the state, the number of benches for each state, the location, and with sitting or circuit bench.
  • Key details of the notification are, that each states across India have its designated benches, while states like,
    • Gujarat, Karnataka, Rajasthan, Tamil Nadu, and Puducherry are constituted with two benches each.
    • Maharashtra and Uttar Pradesh with three benches each.
    • Andaman and Nicobar Islands, West Bengal, and Sikkim with 2 benches together.

The mentioned circuit benches ought to come into operation as and when determined by the President of GSTAT, which is dependent on the volume of appeals filed in that particular jurisdiction.

Also, one Judicial Member and one Technical Member will be involved in the additional associated with the bench.[6]

Appointment of President:

On, 6th May 2024, the Press Information Bureau posted its press release regarding the Appointment of President for GSTAT. Therein, the first president of GSTAT is Justice (retd.) Sanjaya Kumar Mishra, for which Union Finance Minister Smt. Nirmala Sitharaman administered the oath.

This appointment was by a “Search-cum-Selection Committee”, which was led by the Hon’ble CJI of India[7].

GSTAT Authorities:

As of notification dated 28th July 2024, on the direction of the President of India, the notification was released regarding “Group B” and “Group C” services in GSTAT as per Central Civil Service Rules, 1965[8]. Wherein, for each service, three categories of authorities are being posted.

  • Group B
    • Appointing Authority - They are the President of GSTAT, and in their absence, it will be Judicial Member of the Principal Bench of GSTAT.
    • Disciplinary Authority - The same as appointing authority, who is again competent to penalize or “impose penalties”.
    • Appellate Authority - Secretary, Revenue Department, Ministry of Finance.
  • Group C
    • Appointing Authority - They are the Registrar of GSTAT, and in their absence, it is the Joint Secretary, Revenue Department, Ministry of Finance.
    • Disciplinary Authority - The same appointing authority, who is again competent to penalize or “impose penalties”.
    • Appellate Authority - President of GSTAT.

Appeal Process:

Appeals to the Appellate Tribunal are covered under Section 112[9]. As provided in Notification No. 12/2024-Central Tax, which was notified on 10th July 2024, it clarified the appeal procedure to be followed in the GSTAT, which included the filing requirements and forms.  Key details of the notification are,

  • Forms to be filled as part of the procedure:
    • Appeals in Form GST APL-05
    • Cross-objection in Form GST APL-06
    • Applications in Form GST APL-07
    • Form GST APL-05SW/07W is to be used in case of withdrawal of appeals (But this is contingent upon approval of the GSTAT).

The notification also details the fee required while filing the appeals which goes from Rs. 5,000 to Rs. 25,000, which depends on the dispute in matter[10].

Digitization Checklist

GSTAT has embraced digitization to streamline its operations and enhance accessibility. This checklist outlines the digital aspects of its functioning:

  • Availability of Case Information: Information about cases, including status and case numbers, is accessible online.
  • Disposal Standards: GSTAT maintains records of case disposal, ensuring transparency and accountability.

Research that Engages With GSTAT

The GSTAT Coalition in India assembled experts from various fields to advocate for the swift development of the GST Appellate Tribunal. This coalition formulated several design principles for GSTAT's technology and administration.

These principles aimed to ensure that GSTAT is citizen-centric, independent from other government organs, federal in nature, digitally accessible to the public, and resilient. In addition to these principles, the coalition also provided practical recommendations for implementing them effectively. A recommendation was also made to establish institutional capacity for technology and data analytics through an in-house team for ICT functions.

A governance structure was also proposed, which includes:

  • Aligning the technology and data architecture with the internal organization of GSTAT.
  • Creating a Project Management Unit (PMU) with diverse expertise, comprising experts in project management, GST law, adjudication processes, procurement, and stakeholder engagement.

Additionally, the coalition suggested various models for building the technological infrastructure, including leveraging GSTN, utilizing the National Informatics Centre, outsourcing to external vendors, and establishing a special-purpose vehicle.

Funding options were explored, with reference to the case of Roger Mathew (2020 6 SC 1)[11] and potential alternatives.

The coalition also discussed the technological architecture for GSTAT, covering digitization, integration of vertical and horizontal chains, the Case Management System (CMS), digital citizen experience, data and analytics capabilities, and cloud infrastructure.

Way Forward:

The immediate formation of a GSTAT and its smooth functioning thereafter is incredibly important. Research, legislation for the establishment, rules for the appointment and conditions of the chairman and members, notification for the creation of the national bench, and state benches are all in place.

  1. ↑ Central Goods and Services Tax Act, 2017, § 109, No. 12, Acts of Parliament, 2017 (India).
  2. ↑ Central Goods and Services Tax Act, 2017, No. 12, Acts of Parliament, 2017 (India).
  3. ↑ Central Goods and Services Tax Act, 2017, § 110, No. 12, Acts of Parliament, 2017 (India).
  4. ↑ Central Goods and Services Tax Act, 2017, § 111, No. 12, Acts of Parliament, 2017 (India).
  5. ↑ Central Goods and Services Tax Act, 2017, § 109 (3), No. 12, Acts of Parliament, 2017 (India).
  6. ↑ TAXO ONLINE, https://taxo.online/wp-content/uploads/2024/08/GSTAT-Notification-.pdf, (last visited Sep 21, 2024).
  7. ↑ PIB, https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2019749, (last visited Sep 21, 2024).
  8. ↑ Central Civil Services (Classification, Control, and Appeals) Rules, 1965.
  9. ↑ Central Goods and Services Tax Act, 2017, § 112, No. 12, Acts of Parliament, 2017 (India).
  10. ↑ TAX INFORMATION PORTAL, https://taxinformation.cbic.gov.in/view-pdf/1010097/ENG/Notifications, (last visited Sep 21, 2024).
  11. ↑ Rojer Mathew v. South Indian Bank Limited, (2020) 6 Supreme Court Cases 1.
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