Legal Challenge Raises Procedural Concerns Over GST Appellate Tribunal Composition and Tax Dispute Resolution Mechanism

The HC entertained a writ petition challenging the 1st appellate order due to non-constitution of the Second Appellate Tribunal under GST Act. The petitioner contested tax and penalty liability, arguing lack of proper appellate mechanism. The court issued notice to opposite parties, directing service, replies, and setting a future hearing date, while highlighting procedural requirements for potential appeal.

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Issues involved:
The issues involved in the judgment are the constitution of the Second Appellate Tribunal under Section 107 of the GST Act, the challenge to the 1st appellate order dated 31.05.2023, and the liability to pay tax and penalty.

Constitution of Second Appellate Tribunal:
The writ petition was entertained due to the non-constitution of the Second Appellate Tribunal under Section 107 of the GST Act. The petitioner challenged the 1st appellate order passed by the Joint Commissioner of State Tax (Appeal) for not admitting the appeal, citing contravention to sub-sections (1) & (4) of Section 107 of the GST Act. The petitioner argued that as the Second Appellate Tribunal has not been constituted yet, this Court should entertain the writ petition.

Challenge to 1st Appellate Order:
The petitioner filed the writ petition challenging the 1st appellate order dated 31.05.2023, which was passed by the Joint Commissioner of State Tax (Appeal). The authority rejected the appeal filed under sub-Section (1) of Section 107 of the Odisha Goods and Services Tax Act, 2017, on the grounds of contravention to the GST Act. The petitioner contended that they are not liable to pay the tax and penalty, and as there is no Second Appellate Tribunal constituted, this Court should entertain the writ petition.

Liability to Pay Tax and Penalty:
The Addl. Standing Counsel argued that there is a delay in preferring the appeal, and the Court may not be able to condone the delay beyond four months. It was contended that the petitioner is liable to pay the tax and penalty. If the petitioner wishes to appeal before the Second Appellate Tribunal, they would be required to pay 20% of the balance disputed tax for the appeal to be considered. The counsel highlighted that the petitioner must fulfill this condition to avail the remedy of appealing before the Second Appellate Tribunal.

Conclusion:
The Court issued notice to the opposite parties, and the Addl. Standing Counsel for the Department accepted the notice. The writ petition was to be served on the counsel within three working days. The parties were directed to file their replies and rejoinders within the specified timelines. The matter was listed with another case on a fixed date for further proceedings.

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