GST Tribunal Not Yet Operational: High Court Allows Appeal to Principal Bench

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Case Name

V.S. Products v. Additional Commissioner (Appeals) & Ors.(High Court of Bombay at Goa)

Writ Petition No.124 of 2023

Date: 8th February 2024

Key Takeaways

• GST Tribunal Benches: The State Bench for Goa was notified but not yet functional because members had not been appointed.
• Right to Appeal Protected: The court clarified that the petitioner’s right to appeal is protected, and the limitation period is calculated from the date the Tribunal becomes operational, as per the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019.
• Alternate Remedy: The petitioner can file an appeal before the Principal Bench in Delhi until the Goa Bench is operational.
• Limitation Period: Time spent litigating in the High Court will be considered when deciding on condonation of delay for filing the appeal.
• No Bar to Appeal: The absence of an operational State Bench does not bar the petitioner from seeking appellate remedy.

Issue

Can a petitioner file an appeal before the Principal Bench of the GST Appellate Tribunal when the State Bench (Goa) has been notified but is not yet operational due to non-appointment of members?

Facts

• Parties: V.S. Products (petitioner) vs. Additional Commissioner (Appeals) and others (respondents).
• Background: The petitioner wanted to appeal a GST order but found that, although the State Bench for Goa had been notified (as per notification dated 14/09/2023), it was not operational because the Chairperson and members had not been appointed.
• Legal Hurdle: The petitioner was concerned about losing the right to appeal due to the non-functioning of the State Bench and the running of the limitation period.
• Relevant Law: Section 109 of the Central Goods and Services Tax Act, 2017 (CGST Act) deals with the constitution of the Appellate Tribunal. Section 112 deals with the limitation period for filing appeals.
• Government Notification: The Central Government had issued the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019, clarifying how the limitation period is to be calculated when the Tribunal is not yet operational.

Arguments

Petitioner (V.S. Products)

• The State Bench for Goa is not operational, so the petitioner cannot file an appeal there.
• Filing before the Principal Bench in Delhi may not be appropriate unless the issue relates to “place of supply” under Section 2(86) of the CGST Act.
• The petitioner risks losing the right to challenge the order if forced to wait for the State Bench to become operational.

Respondents (Government)

• The right to appeal and the limitation period are protected by the 2019 Removal of Difficulties Order.
• The State Bench for Goa has been notified, and members are likely to be appointed soon.
• The petitioner can file an appeal before the Principal Bench in Delhi if the State Bench is not operational.

Key Legal Precedents & Provisions

• Section 109 of the CGST Act, 2017: Deals with the constitution of the Appellate Tribunal, including State Benches.
• Section 112 of the CGST Act, 2017: Specifies the limitation period for filing appeals.
• Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019:
• Clarifies that the limitation period for filing an appeal starts from the later of (i) the date of communication of the order, or (ii) the date the President or State President of the Tribunal enters office after its constitution under Section 109.

Judgement

• Court’s Decision: The High Court disposed of the writ petition, granting liberty to the petitioner to file an appeal before the Principal Bench in Delhi, since the State Bench in Goa is not yet operational.
• Transfer of Appeal: If the Goa State Bench becomes operational (members appointed), the appeal can be transferred there for adjudication.
• Limitation Period: The time spent litigating before the High Court will be considered when deciding on condonation of delay for filing the appeal.
• Order: The petition stands disposed of with these directions and observations. The parties are to act on an authenticated copy of the order.

FAQs

Q1: What if the State Bench in Goa becomes operational after I file an appeal in Delhi?

A: The appeal can be transferred to the Goa State Bench for adjudication once it becomes operational.

Q2: Will I lose my right to appeal because the State Bench is not yet functional?

A: No, your right to appeal is protected. The limitation period is calculated from the date the Tribunal becomes operational, as clarified by the 2019 Order.

Q3: What happens to the time I spent waiting for the State Bench to be constituted?

A: The time spent litigating before the High Court will be considered when deciding on condonation of delay for filing your appeal.

Q4: Can I file an appeal before the Principal Bench in Delhi for any GST issue?

A: Generally, the Principal Bench deals with “place of supply” issues, but in the absence of an operational State Bench, you can file your appeal there for other issues as well, as per this judgment.

Q5: What legal provisions did the court rely on?

A: The court relied on Section 109 and Section 112 of the CGST Act, 2017, and the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019.