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Government notifies 31 Benches of GST Appellate Tribunal

In 28 Indian states and union territories, there are 31 benches established, with Uttar Pradesh having the highest number. The Confederation of Indian Industry (CII) suggests that the quicker resolution of cases by specialized tribunals will positively impact business sentiments in India.

The Finance Ministry officially announced the formation of 31 Appellate Tribunals for Goods and Services Tax (GST) across 28 Indian states and eight Union Territories. This move is aimed at resolving a growing number of disputes between taxpayers and the Revenue Department.

The creation of these tribunals, initially planned during the GST regime implementation in July 2017, received approval from the GST Council in July this year. This decision was eagerly awaited by industry players, who, in the past six years, had been approaching the High Courts and Supreme Court for dispute resolution.

As of June 30, the number of pending appeals related to central GST levies had risen significantly to over 14,000 cases, indicating a 20% increase compared to March 31 this year.

Regarding the distribution of these tribunals in different states, it was proposed by the States that 50 tribunal benches should be established. However, the central government has indicated that they will be set up gradually, starting with State capitals and cities with High Court benches. The first set of tribunals is expected to become operational between November and January 2024.

Initially, Uttar Pradesh will have the highest number of GST tribunal benches, with three benches planned for Lucknow, Varanasi, Ghaziabad, Agra, and Prayagraj. Karnataka and Rajasthan will each have two benches, while Maharashtra and Goa together will have three benches to handle appeals.

Tamil Nadu and Puducherry, as well as Gujarat and the Union Territories of Dadra and Nagar Haveli, and Daman and Diu, will each have two benches. Disputes arising in West Bengal, Sikkim, and the Andaman and Nicobar Islands will be addressed by two benches of the tribunal in Kolkata.

For the seven northeastern States, one tribunal bench is proposed in Guwahati, with circuit benches in Aizawl, Agartala, and Kohima, which will be operational based on the number of appeals filed by suppliers in those respective States.

The establishment of GST Appellate Tribunals (GSTATs) is expected to expedite the adjudication process and provide tax certainty, especially in recurring litigation cases. Abhishek A. Rastogi, founder of Rastogi Chambers, who has argued various writ petitions before the High Courts in the absence of such a tribunal, expressed optimism about this development.

Chandrajit Banerjee, director general of the Confederation of Indian Industry, emphasized that expediting the resolution of cases through dedicated and specialized GSTATs will boost business sentiments and improve the ease of doing business in the country.

The number of appeals against the decisions of the first Appellate Authorities has been rising significantly, doubling from 5,499 cases in 2020-21 to 11,899 cases in 2022-23 over the last two years. Mr. Rastogi highlighted that tribunal decisions will provide relief to taxpayers burdened with high pre-deposit rates.

Photo Credit: AFP