GST tax appeal blocked by non-functional Appellate Tribunal; taxpayer allowed to appeal later with pre-deposit, stay continues

Where the statutory appeal under the CGST/SGST regime was unavailable due to the non-functional GST Appellate Tribunal, the HC held that the petitioner should be permitted to avail the alternate appellate remedy once the Tribunal becomes operational, relying on the relevant CBIC order, Central notification dated 17.09.2025, and Central circular dated 11.07.2024. The HC directed that upon constitution/assumption of office by the Tribunal's President/State President, the petitioner may file an appeal after making the requisite statutory pre-deposit, and the appellate authority must decide it in accordance with law; the statutory stay under s.112(9) would continue until disposal of the appeal, failing which the State could proceed with recovery.

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1. ISSUES PRESENTED AND CONSIDERED

(i) Whether, in view of the non-functional status of the Goods and Services Tax Appellate Tribunal (absence of appointed President/Members), the petitioner should be granted liberty to pursue the statutory second appeal when the President/State President enters office, and how limitation is to be reckoned for such appeal.

(ii) Whether the petitioner is entitled to protection in the nature of continuance of the statutory stay under Section 112(9) of the Chhattisgarh Goods and Services Tax Act, 2017 pending disposal of the second appeal, subject to compliance with statutory pre-deposit requirements.

(iii) What consequences should follow if the petitioner fails to file the appeal within the prescribed limitation or fails to make the required deposit within the time stipulated by the Court.

2. ISSUE-WISE DETAILED ANALYSIS

Issue (i): Liberty to file second appeal upon Tribunal becoming functional; reckoning of limitation

Legal framework: The Court noted that the statutory scheme provides a second appeal before the Goods and Services Tax Appellate Tribunal, and referred to Section 112 of the Act, 2017 in connection with filing the appeal and limitation. The Court also considered administrative instruments placed before it (order dated 03.12.2019, notification dated 17.09.2025, and circular dated 11.07.2024) to address the practical difficulty where the Tribunal is notified but not operational due to non-appointment of the President/Members.

Interpretation and reasoning: The Court accepted that, despite notification of the Tribunal, the absence of appointed President/Members effectively prevents the statutory remedy from being availed. Having regard to the materials relied upon by the parties and prior orders of the Court on the same subject, the Court found it appropriate to preserve the statutory appellate remedy by permitting the petitioner to invoke the appellate provision as soon as the President/State President enters office. The Court thereby avoided adjudicating the merits of the underlying dispute in writ jurisdiction and channelled the dispute to the statutory forum once functional.

Conclusion: The petitioner was permitted to file the second appeal after the President/State President enters office of the Appellate Tribunal, subject to statutory deposit, and the appellate authority was directed to decide the appeal strictly in accordance with law.

Issue (ii): Continuance of statutory stay under Section 112(9) pending appeal, conditional on compliance

Legal framework: The Court expressly applied Section 112(9) of the Act, 2017 concerning statutory stay during pendency of the appeal, and referred to the requirement of statutory deposit under Section 112(8).

Interpretation and reasoning: Since the Court was directing the petitioner to pursue the statutory appeal when the Tribunal becomes functional, it simultaneously ensured interim protection by directing that the statutory stay contemplated under Section 112(9) would remain operative until the appeal is decided, thereby balancing the petitioner's right to an effective appellate remedy with the revenue's interest, subject to compliance with deposit requirements.

Conclusion: The Court directed that the statutory stay under Section 112(9) shall continue till the decision of the second appeal, contingent upon compliance with the statutory deposit regime.

Issue (iii): Consequences of non-filing within limitation and non-deposit within stipulated time

Legal framework: The Court addressed limitation for filing the appeal and the statutory/administrative framework regarding deposit timelines, including the circular dated 11.07.2024, and reiterated the State's recovery powers in accordance with law if conditions are not met.

Interpretation and reasoning: The Court clarified that its protective directions were conditional: (a) if the appeal is not filed within the prescribed limitation, the State would be free to proceed for recovery of remaining tax, interest, and penalty in accordance with law; and (b) if the amount required for filing the appeal is not deposited within 30 days from the date of the order, the Court's order would lose efficacy (while noting the submission that the statutory deposit had already been made).

Conclusion: The Court preserved the State's liberty to recover dues upon default in timely appeal-filing, and made the relief conditional upon deposit compliance within the stipulated period, failing which the order would cease to operate.

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