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Circular No. 207/1/2024-GST
F. No. CBIC-20001/4/2024-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
****
North Block, New Delhi,
Dated the 26thJune 2024
To,
The Principal Chief Commissioners / Chief Commissioners /
Principal Commissioners /Commissioners of Central Tax (All)
The Principal Directors General/ Directors General of Central Tax (All)
Madam/Sir,
Subject: Reduction of Government Litigation – fixing monetary limits for filing appeals
or applications by the Department before GSTAT, High Courts and Supreme Court -
reg.
Reference is invited to the National Litigation Policy which was conceived with the
aim of optimizing the utilization of judicial resources and expediting the resolution of
pending cases. It underscores the importance of prudent litigation practices by establishing
thresholds for filing appeals in Revenue matters. Specifically, the Policy mandates that
appeals should not be pursued when the amount involved is below a specified monetary limit
set by Revenue authorities. Furthermore, it discourages filing appeals in cases where
established precedents from Tribunals and High Courts have settled the matter and have not
been contested in the Supreme Court.
1.1
Section 120 of the Central Goods and Services Tax Act, 2017 (hereinafter referred as
“the CGST Act”) provides for power to the the Central Board of Indirect Taxes & Customs
(hereinafter referred to as “the Board”) for fixing the monetary limits for filing of appeal or
application by the tax authorities as below:
“120. Appeal not to be filed in certain cases. —
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(1) The Board may, on the recommendations of the Council, from time to time, issue
orders or instructions or directions fixing such monetary limits, as it may deem fit, for
the purposes of regulating the filing of appeal or application by the officer of the
central tax under the provisions of this Chapter.
(2) Where, in pursuance of the orders or instructions or directions issued under sub-
section (1), the officer of the central tax has not filed an appeal or application against
any decision or order passed under the provisions of this Act, it shall not preclude
such officer of the central tax from filing appeal or application in any other case
involving the same or similar issues or questions of law.
(3) Notwithstanding the fact that no appeal or application has been filed by the officer
of the central tax pursuant to the orders or instructions or directions issued under
sub-section (1), no person, being a party in appeal or application shall contend that
the officer of the central tax has acquiesced in the decision on the disputed issue by
not filing an appeal or application.
(4) The Appellate Tribunal or court hearing such appeal or application shall have
regard to the circumstances under which appeal or application was not filed by the
officer of the central tax in pursuance of the orders or instructions or directions
issued under sub-section (1).”
2.
Accordingly, in exercise of the powers conferred by Section 120 of the CGST Act
read with section 168 of the CGST Act, the Board, on the recommendations of the GST
Council, fixes the following monetary limits below which appeal or application or Special
Leave Petition, as the case may be, shall not be filed by the Central Tax officers before
Goods and Service Tax Appellate Tribunal (GSTAT), High Court and Supreme Court under
the provisions of CGST Act, subject to the exclusions mentioned in para 4 below:
Appellate Forum
Monetary Limit (amount
involved in Rs.)
GSTAT
20,00,000/-
High Court
1,00,00,000/-
Supreme Court
2,00,00,000/-
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3. While determining whether a case falls within the above monetary limits or not, the
following principles are to be considered:
i.
Where the dispute pertains to demand of tax (with or without penalty and/or
interest), the aggregate of the amount of tax in dispute (including CGST,
SGST/UTGST, IGST and Compensation Cess) only shall be considered while
applying the monetary limit for filing appeal.
ii.
Where the dispute pertains to demand of interest only, the amount of interest shall
be considered for applying the monetary limit for filing appeal.
iii.
Where the dispute pertains to imposition of penalty only, the amount of penalty
shall be considered for applying the monetary limit for filing appeal.
iv.
Where the dispute pertains to imposition of late fee only, the amount of late fee
shall be considered for applying the monetary limit for filing appeal.
v.
Where the dispute pertains to demand of interest, penalty and/or late fee (without
involving any disputed tax amount), the aggregate of amount of interest, penalty
and late fee shall be considered for applying the monetary limit for filing appeal.
vi.
Where the dispute pertains to erroneous refund, the amount of refund in dispute
(including CGST, SGST/UTGST, IGST and Compensation Cess) shall be
considered for deciding whether appeal needs to be filed or not.
vii.
Monetary limit shall be applied on the disputed amount of tax/interest/penalty/late
fee, as the case may be, in respect of which appeal or application is contemplated
to be filedin a case.
viii.
In a composite order which disposes more than one appeal/demand notice, the
monetary limits shall be applicable on the total amount of tax/interest/penalty/late
fee, as the case may be, and not on the amount involved in individual appeal or
demand notice.
4. EXCLUSIONS
Monetary limits specified above for filing appeal or application by the department
before GSTAT or High Court and for filing Special Leave Petition or appeal before the
Supreme Court shall be applicable in all cases, except in the following circumstances where
the decision to file appeal shall be taken on merits irrespective of the said monetary limits:
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i.
Where any provision of the CGST Act or SGST/UTGST Act or IGST Act or GST
(Compensation to States) Act has been held to be ultra vires to the Constitution of
India; or
ii.
Where any Rules or regulations made under CGST Act or SGST/UTGST Act or
IGST Act or GST (Compensation to States) Act have been held to be ultra vires the
parent Act; or
iii.
Where any order, notification, instruction, or circular issued by the Government or
the Board has been held to be ultra vires of the CGST Act or SGST/UTGST Act or
IGST Act or GST (Compensation to States) Actor the Rules made thereunder;or
iv.
Where the matter is related to -
a. Valuation of goods or services; or
b. Classification of goods or services; or
c. Refunds; or
d. Place of Supply; or
e. Any other issue,
which is recurring in nature and/or involves interpretation of the provisions of the
Act /the Rules/ notification/circular/order/instruction etc; or
v.
Where strictures/adverse comments have been passed and/or cost has been imposed
against the Government/Department or their officers; or
vi.
Any other case or class of cases, where in the opinion of the Board, it is necessary
to contest in the interest of justice or revenue.
5.
It is pertinent to mention that an appeal should not be filed merely because the
disputed tax amount involved in a case exceeds the monetary limits fixed above. Filing of
appeal in such cases is to be decided on merits of the case. The officers concerned shall keep
in mind the overall objective of reducing unnecessary litigation and providing certainty to
taxpayers on their tax assessment while taking a decision regarding filing an appeal.
6.
Attention is drawn to sub-sections (2), (3) & (4) of section 120 of the CGST Act,
which provide that in cases where it is decided not to file appeal in pursuance of these
instructions, such cases shall not have any precedent value. In such cases, the Reviewing
Authorities shall specifically record that “even though the decision is not acceptable, appeal
is not being filed as the amount involved is less than the monetary limit fixed by the Board.”
6.1
Non-filing of appeal based on the above monetary limits, shall not preclude the tax
officer from filing appeal or application in any other case involving the same or similar issues
in which the tax in dispute exceeds the monetary limit or case involving the questions of law.
