The 49th GST Council, which met on Feb. 18, agreed to pass two Group of Minister reports—one of which was the setting up of the GSTAT, or the Goods and Services Tax Appellate Tribunal, subject to a slight modification in the language of the recommendation.
“Two GoMs reports have been accepted, one slightly with modification and with the understanding that one or two amendments in the language with which it will be brought into the bill,” Union Finance Minister Nirmala Sitharaman said, at the post-meeting press conference.
According to a senior official, who spoke on the condition of anonymity, it is likely to comprise a principal bench, which will look at cases regarding inter-state supply and place of supply. And there would be separate benches, which will hear matters related to state subjects including rate of tax, exemptions, valuation, and input tax credit in as much they relate to intra-state affairs, the official quoted above said.
The national (principal) bench is likely to have two technical members and two judicial members (one from the central government and one from the state), the official said.
However, not all four members would hear each case. It is likely that for any given case, only two members will hear the petitions. For cases with a threshold of up to Rs 50 lakh, a single member will hear the case. These details are still being worked out, said the senior official quoted above.
The tentative formulation for the selection of members for state benches will be presided by a committee comprising the Chief Justice of the High Court of that state and additional secretary or additional chief secretary in that state, the official quoted above said. It is likely that all judicial and technical members of a state bench would be selected from that particular state.
The Finance Minister clarified that the decision of the number of state-level benches of the tribunal will be left to the states.
“States will be given the choice to set up benches in different parts of the states, depending on the population or the total business that’s being done,” Sitharaman said, at the post GST Council meet briefing.
She explained that north-eastern states could opt for one bench for 2-3 states and an additional bench for very far-flung areas.
“The chairperson of the GoM said no interest of the state will suffer, both in reference to representation and also in reference to the number of benches they would want, and the location of such benches within the state,” Sitharaman said.
The discussions of the Council and the GoM recommendations are likely to be circulated to the states as a first draft by tomorrow (Feb. 19), following which the states will have a week to respond to the draft version, Sitharaman told the media.
After this, the accepted language will be compiled and passed to the states and then feature in the upcoming Finance Bill in the Parliament in early March.
Once the law is drafted and passed in the Parliament, hearings might likely begin by the end of the year, according to the senior official quoted above.
“While there is clarity on the composition of the tribunal members and the flexibility, which the state may have to set up number of tribunals—depending on the pending disputes and the geographies—it is important that the administrative framework and e-filing process starts at the earliest,” Abhishek A Rastogi, founder at Rastogi Chambers, told BQ Prime.
“This will ensure that the taxpayers can initiate e-filing of appeals without moving to writ court under Article 226 of the Constitution,” he said.