Appeal to First Appellate Authority

Who Can Appeal to the First Appellate Authority?

Any taxpayer who is dissatisfied with an order issued by an adjudicating authority has the right to file an appeal. This appeal must be lodged within three months of the order date, which can be extended by an additional month if justified. The appeal should be submitted using Form APL-01 and must include the grounds for the appeal and a verification form that is duly signed by the appellant.

It’s essential to upload the order against which the appeal is being made onto the GST portal. Upon submission, the authority will issue an acknowledgment in Form APL-02, along with an appeal number. The date of appeal is considered to be the date when the provisional acknowledgment is issued by the appellate authority.

As discussed in the 53rd GST Council meeting, there has been a recommendation to reduce the maximum pre-deposit amount for filing an appeal before appellate authorities. The pre-deposit limits are proposed to decrease from ₹25 crore to ₹20 crore each under CGST and SGST/UTGST.

If the appellant fails to submit a copy of the order against which the appeal is being filed, they must provide a self-certified copy within seven days of filing Form APL-01. The authority will still issue Form APL-02 with the appeal number, and the appeal date will be marked as the date of provisional acknowledgment. However, if the self-certified copy of the order is not submitted within the stipulated seven days, the appeal will be considered filed only on the date of the document submission.

Upon filing the application, the authority will issue a provisional acknowledgment immediately. However, it is important to note that the appeal will only be recognized as officially filed once a final acknowledgment containing the appeal number is received.

This comprehensive understanding of the process will help taxpayers navigate their appeals to the First Appellate Authority effectively.

Can the Commissioner Appeal to the First Appellate Authority?

Yes, the Commissioner can file an appeal under Section 107(2) in conjunction with Rule 109. The appeal must be submitted to the appellate authority within six months from the date of the order, using Form APL-03. The date of the appeal will be determined following the same guidelines established in Rule 108.

When the Commissioner initiates an appeal, the relevant officer will review the order’s legality and propriety based on the appellant’s motion or upon a request from the Commissioner. The Commissioner can instruct a subordinate officer to submit the appeal to the First Appellate Authority within six months from the order’s date. If the authorized officer files this application, it will be regarded as an appeal against the order, and the Appellate Authority will issue a final acknowledgment along with the appeal number in Form APL-02.

Is Adjournment Allowed?

Yes, the First Appellate Authority can adjourn the hearing of an appeal if there is sufficient cause. The reasons for the adjournment will be documented in writing, and such adjournments are permitted only up to three times.

Will Any Additional Grounds Be Allowed?

The First Appellate Authority may permit the appellant to introduce any grounds of appeal that were not previously specified. However, this is contingent upon the Authority’s assessment that the omission was not intentional.

Negative Impact of the Order

Any order that results in an increase in fees, penalties, or fines, or confiscation of goods of higher value, or a decrease in refunds or input tax credits, must be issued only after providing a reasonable opportunity for the affected party to show cause. Furthermore, any order requiring payment of unpaid or short-paid taxes, or for refunds or input tax credits that have been improperly claimed, can only be passed after the appellant is given a show cause notice. In cases of detention and seizure of goods and conveyances, a penalty of 25% must be paid to file an appeal under Section 107 of the CGST Act.

Time Limit for the Decision

The First Appellate Authority is required to pass its order within one year from the date the appeal is filed. If the decision is stayed by a court or tribunal order, the duration of the stay will not be counted within the one-year timeframe.

Communication of the Decision

The First Appellate Authority must communicate the order to the appellant as well as the adjudicating authority. Additionally, a copy of the order will be forwarded to the jurisdictional Commissioners of CGST and SGST.

Revisional Authority

The Revisional Authority has the power to review the records of any proceeding, either on its own initiative or upon request from the Commissioner of SGST or CGST. The Revisional Authority will examine the records if it believes that any decision made by a subordinate officer is:

• Prejudicial to the interests of revenue
• Illegal
• Improper
• Failing to consider relevant information (whether or not it was available at the time the order was issued)
• Based on observations made by the Comptroller and Auditor General (C&AG)

If the Revisional Authority finds it necessary, it can suspend the order for a period that it deems appropriate, ensuring that the concerned party is given the opportunity to be heard.

When is Revision Not Allowed?

The Chief Commissioner or Commissioner will not revise an order under the following circumstances:

1. Order Under Appeal: If the order is already being appealed, a revision will not be permitted.
2. Time Limit for Appeal: If less than six months have passed since the date of the order, indicating that there is still time left to file an appeal.
3. More Than Three Years: If more than three years have elapsed since the date of the order, a revision cannot be initiated.
4. Already Under Revision: If the order has already been subject to revision, it cannot be revised again.

The Chief Commissioner or Commissioner does have the authority to issue an order on any matter not raised in an existing appeal. Such orders must be issued within one year from the date of the appeal order or within three years from the date of the original order. If the order is stayed by a court or tribunal, the duration of the stay will not count toward this timeframe.

If the aggrieved party is dissatisfied with the decision made by the First Appellate Authority, they have the option to appeal to the National Appellate Tribunal, and if necessary, proceed to the High Court and ultimately the Supreme Court.

FAQs on Procedure of GST Appeals to the First Appellate Authority

1. What is the First Appellate Authority in GST?
   The First Appellate Authority refers to the authority a taxpayer can approach to appeal against an order or decision issued by a lower GST officer, such as a tax assessment or penalty. This authority is generally the Commissioner (Appeals) or any officer designated by the government.
2. When can I file an appeal with the First Appellate Authority under GST?
   You can file an appeal with the First Appellate Authority when you are dissatisfied with a decision or order passed by a lower authority, such as a demand for tax, penalty, or interest. The appeal must be filed within 3 months from the date of communication of the order.
3. What is the procedure to file a GST appeal to the First Appellate Authority?
   To file an appeal:

• The appellant must submit Form GST APL-01 online within three months of receiving the original order.
• Along with the form, relevant documents supporting the appeal and a copy of the challenged order must be attached.
• The appeal is considered only after payment of the pre-deposit (10% of the disputed amount).

4. Is there a fee for filing an appeal with the First Appellate Authority?
   There is no additional fee for filing an appeal. However, a pre-deposit of 10% of the disputed amount (subject to a maximum of ₹25 crores) must be made before filing the appeal.
5. Can the time limit for filing an appeal be extended?
   Yes, the First Appellate Authority may allow a further extension of one month if there is sufficient cause for the delay in filing the appeal beyond the original 3-month period.
6. What happens after filing the appeal with the First Appellate Authority?
   After the appeal is filed, the First Appellate Authority will verify the details and documents submitted. A hearing may be scheduled where both the taxpayer and the tax officer will present their arguments. The authority will then pass an order based on the merits of the case.
7. What if the taxpayer is not satisfied with the order of the First Appellate Authority?
   If the taxpayer is not satisfied with the decision of the First Appellate Authority, they can file a further appeal with the Appellate Tribunal within three months from the date of the First Appellate Authority’s order.
8. What is a pre-deposit in GST appeals?
   A pre-deposit is the amount the taxpayer is required to pay before filing an appeal. In GST appeals, this amount is set at 10% of the disputed tax amount, with an upper limit of ₹25 crores.
9. Can I withdraw the appeal after it has been filed?
   Yes, an appeal can be withdrawn if the appellant decides to do so, either voluntarily or due to settlement of the dispute.
10. How long does the First Appellate Authority take to decide the appeal?
    There is no specific time limit for the First Appellate Authority to pass its order. However, they are expected to dispose of the appeal as expeditiously as possible, typically within one year from the filing date.