Appeal to First Appellate Authority under GST

Last Update Date : May 04, 2019
Estimated Read Time: 5 min

GST law provides a mechanism to appeal against the order issued by the Adjudicating Authority if a person is unsatisfied with such order. A person can knock the doors of First Appellate Authority to appeal against the decision of Adjudicating Authority.

Who is eligible to appeal to the First Appellate Authority?

A person unsatisfied with the order passed by an adjudicating authority can appeal within 3 months (extendable up to 1 month) from the date of the order.
Appeal is made through form GST APL-01.

What is the time limit for Filing an Appeal?

  • Every appeal under this section shall be filed within three months from the date on which the decision or order sought to be appealed against is communicated to the person aggrieved by any decision or order passed under this Act or the SGST or UTGST by an Adjudicating Authority.
  • The First Appellate Authority may allow an appeal to be presented within a further period of one month if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three months.

Mandatory Pre-deposit before Filing Appeal to First Appellate Authority

Appeal cannot be filed unless the appellant has deposited:

  • In full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and
  • sum equal to ten per cent. of the remaining amount of tax in dispute arising from the said order, in relation to which the appeal has been filed.

Appeal by Commissioner to the First Appellate Authority

The Commissioner may, on his own motion, or upon request from the Commissioner of State tax or the Commissioner of Union territory tax, call for verification of the records of the order passed by the Adjudicating Authority direct any officer subordinate to him to apply to the Appellate Authority to ensure its legality and propriety.

  • The time period allowed for such an appeal is up to 6 months from the date on which the order was issued.
  • If the application to the First Appellate Authority is made by the authorized officer then such application is considered an appeal against the order.
  • Appellate Authority will issue a final acknowledgement, along with appeal number through form GST APL-02.
  • This will be considered as appeal before First Appellate Authority.

Adjournment of Hearing

  • The First Appellate Authority has the power to adjourn the hearing of the appeal based on sufficient reason.
  • Such reason is recorded in written form.
  • The hearing cannot be adjourned more than three times.

Allowing Additional Grounds

The Appellate Authority may, at the time of hearing of an appeal, allow an appellant
to add any ground of appeal not specified in the grounds of appeal, if it is satisfied that the omission of that ground from the grounds of appeal was not wilful or unreasonable.

Decision of the First Appellate Authority

  • The First Appellate Authority can confirm, modify or annul the decision but will not refer the case back to the authority.
  • If the order results in increase in fee, penalty, fine or confiscation of higher value goods or it leads to decrease in  input tax credit or refund then the taxpayer is given a notice and an opportunity to be heard before such order is passed.
  • If the order is for the payment of unpaid/short-paid tax or wrong refunds or input tax credit wrongly availed then the taxpayer is given a notice and an opportunity to be heard before such order is passed.
  • First Appellate Authority can increase demand of tax or payment of wrongly availed input tax credit after giving show cause notice. However, such order has to be passed within the time limit specified under section 73 or 74.
  • The order of the First Appellate Authority disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reasons for the decision.

Time Limit for the Decision

  • The First Appellate Authority must issue the order within one year from the date on which the appeal is filed.
  • However, if any order from a court or tribunal puts a stay on it then the period of such stay should be excluded while considering the one year period mentioned above.

Communication of the Decision

When the First Appellate Authority gives passes its order or decision, it needs to communicate it to the following parties by sending a copy of the order to them:

  • the appellant
  • the Respondent
  • the Adjudicating Authority
  • the Jurisdictional Commissioner of Central and State or UT

First Appellate Authority cannot Remand

The First Appellate Authority cannot remand the matter, as this power is not given to it by Statute. Power to remand has been specifically given to Appellate Tribunal.

Revisional Authority or Revisional Powers of Commissioner

The Revisional Authority can, on his own, or on request from the Commissioner of State Tax or UT Tax, examine the records of any proceeding. He will examine the records if he considers that any decision by any subordinate officer is-

  • Prejudicial to the interest of the revenue
  • Illegal or
  • Improper or
  • Not taking into account certain material facts(whether or not available at the time of issuance of the order) or
  • An observation was made by the CAG

If he thinks it necessary, he can stay the order for a time period as he deems fit. The person concerned will be given an opportunity of being heard.

Chief Commissioner or Commissioner can enhance or modify or annul the order.

When is Revision not Allowed?

The Chief Commissioner or Commissioner will not revise the order if-

  • The order is subject to appeal
  • 6 months have not passed from the date of order (i.e., there is time left for appeal)
  • More than three years have passed after the date of order
  • The order has already been taken for revision

The Chief Commissioner or Commissioner can pass an order on any point which has not been raised in any appeal. Such order must be passed before the expiry of a period of one year from the date of the order in such appeal or before the expiry of a period of three years referred to in clause (b) of sub-section 2 of section 108, whichever is later. If the order is stayed by the order of a Court or Tribunal, the period of the stay will be excluded.

If the aggrieved person is not satisfied with the decision of the First Appellate Authority, he can appeal to the National Appellate Tribunal and then to High Court and finally Supreme Court.

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CA Chetan Shinde
CA Chetan Shinde
Chetan is the Lead Tax Advisor at H&R Block (India) with an experience of almost half a decade in audit and taxation. His professional areas of interest are GST advisory and statutory audit. Apart from taxation, he is passionate about social causes and works extensively towards rural school development and literacy.