India's long-awaited GST Appellate Tribunal (GSTAT) is set to begin hearings from December 2025, providing long-overdue relief for thousands of taxpayers caught in prolonged litigation. As of June 2023, over 14,000 GST cases were pending across States and courts, largely due to the absence of a functional tribunal.
Once operational, all pending disputes will be transferred to the GSTAT, while fresh appeals will also be filed directly with the Tribunal. The move is expected to ease the mounting burden on High Courts and Commissioners (Appeals), where GST-related disputes have been piling up for years.
Two-tier appellate structure
The GST Council has already approved a two-tier appellate framework comprising one Principal Bench in New Delhi and 31 State benches at 45 locations across the country. These benches will handle appeals, advance rulings, and related matters. Taxpayers appealing against GST claims will be required to make a pre-deposit of 10% of the disputed tax amount (capped at Rs 40 crore) before their case is heard.
Why disputes arise
Industry experts highlight that GST litigation commonly stems from:
- Classification disputes over goods and services
- Valuation disagreements
- Eligibility of input tax credit (ITC)
- Refund claims
- Aggressive enforcement by GST authorities
A senior tax consultant explained that much of the litigation arises because "the GST law remains unsettled on many key issues, and divergent interpretations exist across jurisdictions."
Concerns over readiness
While the government has notified benches, none are fully operational yet, with many still lacking adequate infrastructure, courtrooms, support staff, and digital case-management systems. Tax experts warn that unless these gaps are quickly addressed, the Tribunal could face the same delays and inconsistent outcomes it was designed to prevent.
Another practitioner pointed out that years of backlog, relaxed pre-deposit rules, and clearer procedures could lead to a spike in filings once GSTAT opens. "The system may be overwhelmed from Day One unless infrastructure and staffing are scaled up," he said.
Impact on businesses
For businesses, prolonged disputes over GST have been costly, tying up working capital, complicating pricing and procurement decisions and escalating legal costs. With disputed tax demands running into over Rs 1 lakh crore, the launch of GSTAT is seen as a crucial step in bringing certainty and efficiency to India's indirect tax framework.
As the Tribunal gears up for its first hearings, all eyes will be on how quickly it can clear the backlog and offer consistent rulings to strengthen confidence in the GST regime.
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