The Central Board of Indirect Taxes and Customs ( CBIC ) has introduced significant amendments aimed at reducing the pre-deposit requirement for filing appeals under the Goods and Services Tax ( GST ) regime. These changes, part of the Central Goods and Services Tax (Second Amendment) Rules, 2024, are set to take effect from November 1, 2024.
The 53rd GST Council Meeting had recommended reduction of the quantum of pre-deposit for filing appeals under the Goods and Services Tax Regime.
The GST Council recommended reducing the amount of pre-deposit for filing of appeals under GST to ease cash flow and working capital blockage for the taxpayers. The maximum amount for filing an appeal with the appellate authority has been reduced from Rs. 25 crores CGST and Rs. 25 crores SGST to Rs. 20 crores CGST and Rs. 20 crores SGST.
Further, the amount of pre-deposit for filing appeal with the Appellate Tribunal has been reduced from 20% with a maximum amount of Rs. 50 crores CGST and Rs. 50 crores SGST to 10 % with a maximum of Rs. 20 crores CGST and Rs. 20 crores SGST.
Read More: Pre Deposit Reduction recommended by GST Council
Previously, taxpayers were required to make a pre-deposit of 10% of the disputed tax amount, subject to a maximum limit of ₹25 crore for appeals related to Central GST (CGST) and State GST (SGST) and ₹50 crore for Integrated GST (IGST).
Complete Draft Replies of GST ITC Related Notices, Click Here
The Central Board of Indirect Taxes and Customs (CBIC) has inserted the following in Rule 108(1) of the CGST Act and Rule 110(1) of the CGST Act:
“In the said rules, in FORM GST APL-01, with effect from the 1st day of November, 2024.–
(a) in entry number 15,–
(i) in clause (a), in the Table, in the first column relating to “Particulars”, in item (b) relating to “pre-deposit”, for the brackets, letters, words and figures “(b) Pre- deposit (10% of disputed tax /cess but not exceeding Rs. 25 crore each in respect of CGST, SGST or cess or not exceeding Rs.50 crore in respect of IGST and Rs. 25 crore in respect of cess)”, the brackets, letters, words, and figures “(b) Pre- deposit (10% of disputed tax /cess but not exceeding Rs. 20 crore each in respect of CGST, SGST, cess, and not exceeding Rs. 40 crore in respect of IGST)” shall be substituted;
(ii) in clause (b), in the opening portion, for the brackets, words, figures and letters “ (pre-deposit 10% of disputed tax and cess but not exceeding Rs. 25 crore each in respect of CGST, SGST or cess or not exceeding Rs.50 crore in respect of IGST and Rs. 25 crore in respect of cess)”, the brackets, words, figures and letters “(pre-deposit 10% of disputed tax and cess but not exceeding Rs. 20 crore each in respect of CGST, SGST, cess, and not exceeding Rs. 40 crore in respect of IGST)” shall be substituted.
In the said rules, in FORM GST APL-05, with effect from the 1st day of November, 2024,
(a) in entry number 14,–
(i) in clause (a), in the Table, in the first column relating to “Particulars”, in item (b) relating to “pre-deposit”, for the brackets, letter, words and figures “(b) Pre- deposit (20% of disputed tax /cess but not exceeding Rs. 50 crore each in respect of CGST, SGST or cess or not exceeding Rs.100 crore in respect of IGST and Rs. 50 crore in respect of cess)”, the brackets, letters, words and figures “(b) Pre- deposit (10% of disputed tax/cess but not exceeding Rs. 20 crore each in respect of CGST, SGST, cess, and not exceeding Rs. 40 crore in respect of IGST)” shall be substituted;
(ii) in clause (b), for the opening portion, the following shall be substituted, namely: – “(b) Details of payment of admitted amount and pre-deposit of 10% of the disputed tax and cess but not exceeding Rs. 20 crore each in respect of CGST, SGST, cess and not exceeding Rs. 40 crore in respect of IGST.”
These amendments aim to alleviate the financial burden on businesses while ensuring that tax disputes are resolved without undue strain on cash flow.
Complete Draft Replies of GST ITC Related Notices, Click Here
Additionally, the changes in the GST rules also focus on simplifying the appeal process, ensuring that businesses can address disputes in a more streamlined manner. The reduction in pre-deposit caps is expected to provide a major boost for industries with large tax disputes, allowing them to pursue legal remedies without being overly constrained by liquidity issues.
By lowering the financial barriers to filing appeals, professionals and taxpayers hope for timely resolution of disputes and enhanced overall efficiency.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
