Goods and service tax appellate tribunal- part two.

It is really heartening to note that e appeals are being accepted in large numbers in the GSTAT portal and as on 23/06/2026 around 08.30 PM, more than 23,000 appeals have been filed with around 11,000 in just 23 days. To be more specific, more than 6,000 appeals have been filed during last 7 days. The team behind this success includes the GSTAT, Finance Ministry, NIC Technical Team and the GST and Indirect taxation committee of the institute of chartered accountants of India whose pivotal role played during last six months has brought thins to this stage.

Taxpayers as well as tax professionals must now focus on filing the appeal before GSTAT wherever required either before 30/06/2026 or with suitable condonation application which also attracts additional fees of Rs.5,000 before 30/09/2026 to ensure that there are no severe damages to the taxpayer. The rationale behind this requirement is simple and easy to understand. The first pre deposit which was made at 10% of the disputed GST has stayed recovery only till the final disposal of the first appeal. In case any tax payer has already paid the second 10% pre deposit with an intention to file the appeal before GSTAT, the stay on recovery of balance 80 % is automatically vacated in case the appeal is not filed before GSTAT by the due date. The GST department is closely monitoring all APL 04 and even issues periodical reminders to the taxpayer to keep the demand live.

The last date for filing second appeal for all orders passed under 107 or 108 on and up to 31/03/2026 remains as 30/06/2026 with a maximum condonable delay of three months only. In case the appeal is not filed by that deadline or in case the appeal is dismissed by GSTAT, the entire tax amount as determined in first appeal becomes due along with applicable interest as well as penalty. The situation would change from bad to worse in case the invocation of section 74 is upheld as the penalty amount is 100 % as against 10% under 73 which is a jump of nine times over 73 penalty.

Based on our past experience from various jurisdictional high court verdicts, there are few grounds which may help taxpayer as well as tax professionals to rely upon as well as strengthen their grounds of appeal before the GSTAT and let us focus few such grounds. It has been held by various high courts that single show cause notice for multiple tax periods is impermissible, especially where 74 is not established. In the second place, wherever OIO was passed without affording the opportunity of personal hearing and OIA was rejected on limitation ground, an attempt may be made now as GSTAT is likely to take unbiased view in all the matters.

The violation of section 75 (7) is simply impermissible and there can not be a better time to verify each and every OIO and OIA passed till date to check whether there is any such violation. For the benefit of readers 75(7) is furnished as ready reference. The amount of tax, interest and penalty demanded in the order shall not be in excess of the amount specified in the notice and no demand shall be confirmed on the grounds other than the grounds specified in the notice.

In case section 74 is invoked based on information already available with the tax authorities, we may appeal to GSTAT to cover the case under section 73 based on CBIC instructions dated 13/12/2023. The idea behind this is that when a demand is raised by GST authorities based on differences in GST returns, there is absolutely no suppression or wilfull-misstatement. Any one or more of the three ingredients fraud or wilful-misstatement or suppression of fact is sine quo non for invocation of section 74. It is suggested to enclose a copy of CBIC instructions dated 13/12/2023 in each and every case wherever 74 is invoked. GSTAT is most likely to accept this line of arguments which gives substantial relief to taxpayers as waiving demand pertaining to two years in full and reduced penalty are possible.

The timelines specified under 73 as well as 74 for issuing show cause notice as well as passing the order are mandatory. In case OIO is passed in a hurried manner within say 60 days from date of issuance under section 73, the same may be contested before GSTAT now, provided the case was not allowed in first appeal. High Courts have also held that passing the OIO on the same day of personal hearing is also impermissible.

Even non effective service of the show cause notice by simply uploading in additional notices column of GST portal without exploring any other mode is impermissible, despite the same may be sufficient compliance as few courts have already held this as futile exercise. There are several other such grounds which strengthens the case before GSTAT which shall be covered in part three.