Section 107 of CGST Act, 2017 : Section 107: Appeals To Appellate Authority

Explanation using Example

Imagine a business owner, Mr. Sharma, who runs a manufacturing unit. The GST authorities issue an order against him for the underpayment of GST due to the misclassification of goods. Mr. Sharma believes that the goods are classified correctly and that the tax amount demanded is excessive. He decides to appeal against this order.

Mr. Sharma files an appeal to the prescribed Appellate Authority under Section 107(1) of the CGST Act, 2017, within three months from the date the order was communicated to him. Before filing the appeal, he pays the full amount of tax and penalty admitted by him and 10% of the remaining disputed tax amount as per Section 107(6). His appeal is accepted, and recovery proceedings for the balance amount are stayed as per Section 107(7).

The Appellate Authority schedules a hearing, providing Mr. Sharma an opportunity to present his case as per Section 107(8). During the hearing, Mr. Sharma realizes he has another valid point to argue but had not included it in his original grounds of appeal. The Appellate Authority allows him to add this new ground under Section 107(10) since it was not intentionally or unreasonably omitted.

After considering all the evidence and arguments, the Appellate Authority decides in favor of Mr. Sharma, modifying the original order, thereby reducing the tax liability. The decision is documented in writing, stating the points for determination, the decision, and the reasons for the decision as required by Section 107(12).

The Appellate Authority aims to resolve the appeal within one year as per Section 107(13) and communicates the final order to Mr. Sharma, the GST authorities, and the adjudicating authority, as per Sections 107(14) and (15). This order is final and binding, subject to further appeals to higher authorities as per Section 107(16).