Constitute GST Tribunal To Reduce Needless Litigations In The Form Of Filing Writ Petitions: Bombay High Court Advises CBIC

The Bombay High Court has advised the Central Board of Indirect Taxes (CBIC) to construct GST tribunals to reduce needless litigation in the form of filing writ petitions.

"It would be advisable, to avoid further complications, that the Board issues instructions to incorporate Clause 4.2 of the Circular dated 18 March 2020 in each order which is appealable to the Appellate Tribunal constituted under Section 109 of the Act. This would guide the aggrieved parties as to the future course of conduct and reduce needless litigation in the form of filing writ petitions such as the present ones," the division bench of Justice Nitin Jamdar and Justice Abhay Ahuja said.

The petitioners have challenged the order passed in appeal by the Appellate Authority under the Central Goods and Services Act, 2017. The writ petitions were filed on the grounds that the appellate tribunals are not yet constituted.

The Central Goods and Services Act provides a mechanism for appeals. Chapter XVIII deals with appeals and reviews. The order passed under the Act is appealable to the appellate authority under Section 107 of the GST Act. Section 112 provides an appeal thereafter to the Appellate Tribunal. The constitution of the Appellate Tribunal is provided under Section 109.

The Chairman of the Board filed the Circular and Affidavit stating that the appeal to the Appellate Tribunal can be filed within three months (six months in the case of appeals by the government) from the date of the communication of the order or the date on which the President or State President, as the case may be, of the Appellate Tribunal enters office, whichever is later.

The Chairman of the Board stated in his affidavit that the Tribunal's non-constitution would cause no hardship to the taxpayers.

The court stated that the government does not intend for taxpayers to be harmed as a result of the tribunal. With that intent, the period of limitation has been extended. As a corollary of the intention expressed in the affidavit and the circular, it follows that the appealable orders (to the Tribunal) would not be implemented till the Tribunal becomes functional. The writ petitions do not need to remain pending in the High Court.

The court held that the period for filing the appeal will stand extended as indicated in Clause 4.2 of the Circular dated March 18, 2020. The order will not be given effect until two weeks after the period prescribed for filing an appeal under Clause 4.2 of the Circular dated March 18, 2020, is over.

Case Title: Rochem India Pvt. Ltd. Versus CBIC

Citation: Writ Petition No.10883 Of 2019

Citation: 2023 LiveLaw (Bom) 118

Date: 08.02.2023

Counsel For Petitioner: Prakash Shah

Counsel For Respondent: Sangeeta Yadav

Click Here To Read The Order