GST is in force for the last 5 years. Due to ambiguity in the law, various interpretation issues, and frequent amendments/circulars, there has been a substantial increase in litigation. Unfortunately, today after 5 years also there is no sight of the GST Appellate Tribunal. As we understand, the reason for non-constitution is the writ petition challenging the qualification and appointment of Members before High Courts. Even after various courts directed the GST Council and CBIC to form the same at the earliest except for some paper clarifications and instructions, the formation of the GST appellate Tribunal is in limbo.
So where does this leave an assessee?
Today, after an adverse adjudication and First Appellate order, the assessee has no option but to wait for the formation of the bench to file an appeal or file a writ petition in the High Court. This impacts his decision-making on the said issue. Further, as per the practice followed in erstwhile laws, if periodic SCN is issued there will be similar notices/demands for subsequent years as well. The worst scenario is where refunds are being rejected at both levels. In such a scenario, all subsequent refunds also stand rejected by the authorities, leading to a huge working capital blockage.
Further, in spite of full clarity that an appeal may be filed with GST appellate Tribunal within 3 months of its formation, there are state circulars that specify that “Recovery of dues after disposal of appeal After disposal of pending appeal u/s 107, if any demand is confirmed or appellate authority has created the additional demand then in such cases taxpayer shall submit a declaration in Annexure-I before the jurisdictional tax officer stating that he is proposing to file an appeal u/s 112(1) against the appeal order. If such declaration is not submitted within fifteen days from the communication of the said order, then it will be presumed that taxpayer is not willing to file an appeal against the order and recovery proceedings may be initiated as per the provisions of law.”
Is submission of such a declaration mandatory? Are we heading for a huge pile-up of cases like the erstwhile acts when CESTAT was fully operational?
Undue delay in setting up the GST appellate Tribunal is frustrating for the trade, and one must remember “Justice Delayed is Delayed Denied”
Hope the Appellate Tribunals are formed soon.
Chartered Accountant in Pimpri Chinchwad