The long-awaited GST Appellate Tribunals, which aim to resolve disputes between taxpayers and the government under the six-and-a-half-year-old indirect tax system, are expected to commence operations in July or August, according to Revenue Secretary Sanjay Malhotra in an interview with The Hindu on 27th January 2024. “The process has been initiated.
In the near future, you will see an advertisement in the media regarding the selection of members and the president. We hope that within approximately six months from now, we will be able to establish some of the tribunals,” stated Mr. Malhotra. “There are 31 benches located in around 50 different locations, and the majority of them should be operational by July-August… so we should be able to accomplish this shortly after the new government assumes office,” he added.
On July 1, 2017, the GST framework was introduced, which included provisions for the establishment of Appellate Tribunals as the second appellate authority to hear appeals against orders passed by the Appellate Authority under the Central and State GST laws. However, due to the absence of these tribunals, taxpayers have been forced to seek relief from the High Courts. As a result, the number of appeals under central GST laws has increased to around 15,000 by October 31, which is 25% higher than the pending cases as of March 31 last year.
To address this issue, the Central GST law was amended in July to allow for the creation of appellate tribunals. The Finance Ministry then notified the establishment of 31 tribunals across 28 States and eight Union Territories in mid-September. Initially, it was expected that the first set of tribunals would become operational by December 2023 or January 2024. However, it was later discovered that certain provisions regarding the eligibility and age criteria for the members and presiding officers of these tribunals were not in line with the Tribunal Reforms Act of 2021.
In response, the GST Council, chaired by Finance Minister Nirmala Sitharaman, approved amendments in October to align these provisions. These amendments were subsequently passed during Parliament’s winter session in December.
Ms. Sitharaman highlighted in the Lok Sabha that the absence of Goods and Services Tax Appellate Tribunals is depriving taxpayers of a secondary avenue for appeal, leading them to approach the High Court for relief. This, in turn, is placing an additional burden on the High Courts.
In light of this, the minister suggested that taxpayers should consider withdrawing their GST-related cases from the High Courts and the Supreme Court and instead file them with the forthcoming GST appellate tribunals in order to expedite the resolution of their cases.
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