This newsletter discusses the relevant GST laws in relation to the constitution of GST Appellate Tribunal, recommendations made by the GST Council in its 37th meeting and provides clarification on the due date for claiming transitional credit under GST laws.

Constitution of GST Appellate Tribunal

The Hon’ble Madras High Court (the Hon’ble “HC”) in the recent case of Madras Revenue Bar Association v. Union of India & Ors. W.P. 21147 of 2018 struck down the relevant provisions under the Goods and Services Tax (“GST”) laws providing for the constitution of the GST Appellate Tribunal (“GSTAT” / “Tribunal”).

A brief summary of the findings of the Hon’ble High Court are as follows:

• Post analyzing numerous provisions of the GST laws dealing with the powers and jurisdiction of GSTAT, the Hon’ble HC observed that the some of the orders of the Tribunal are not subject to the jurisdiction of High Court and are therefore similar to the orders passed by Central Administrative Tribunal.

• It was further observed that GSTAT is not just an extension of the mechanism to determine the quantum of tax which is only a subject matter of experts, since the determination of applicable tax requires interpretation of various sections and notifications where GSTAT is also required to scrutinize the decision making process.

• It was thus held that GSTAT while undertaking the activities mentioned above has to keep the judicial principles in mind where any weightage in favour of the service members or expert members and value-discounting the judicial members would render the Tribunal less effective and efficacious than the High Courts.

• It was further stated that since in all GST related issues, the litigation shall be between an assessee and the Government, presence of two members from the Government would create a reasonable apprehension of bias and lead an assessee to believe that perhaps the remedy is non-existent.

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