CESTAT or GSTAT? Maharashtra GSTAT Clarifies Appellate Forum for Transitional Refund Claims
A recent ruling of the Maharashtra Bench of the Goods and Services Tax Appellate Tribunal (GSTAT), Thane, has clarified the appropriate appellate forum for refund claims involving unutilised CENVAT credit under the transitional provisions of the Central Goods and Services Tax Act, 2017 (CGST Act).
In Asish Kumar Pati v. Director, decided on 6 August 2026, the Tribunal held that where a refund claim under Section 142(3) of the CGST Act is disposed of in accordance with Section 11B of the Central Excise Act, 1944 (Central Excise Act), and the orders of the adjudicating and first appellate authorities are passed under the erstwhile law, an appeal against such orders lies before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) and not GSTAT.
Background
The respondent had claimed a refund in cash of accumulated and unutilised CENVAT credit under Section 142(3) of the CGST Act. The refund claim was adjudicated under Section 11B of the Central Excise Act, with both the Order-in-Original and the first appellate order having been passed under the erstwhile Central Excise regime read with the CENVAT Credit Rules, 2004.
The Revenue subsequently filed an appeal before GSTAT. At the hearing, the Tribunal raised a preliminary question as to whether GSTAT was the appropriate forum. The Revenue contended that the appeal was maintainable before GSTAT since the refund claim was made under Section 142(3) of the CGST Act.
The respondent, however, submitted that the orders under challenge had been passed under Section 11B of the Central Excise Act and that the appropriate appellate forum was therefore CESTAT. The respondent also relied upon the preamble to the impugned order, which directed the aggrieved party to approach CESTAT. The question before GSTAT was therefore one of appellate jurisdiction.
GSTAT's ruling
The Tribunal rejected the Revenue's contention and held that it did not have jurisdiction to entertain the appeal. Section 142(3) of the CGST Act provides that claims for refund of CENVAT credit, duty, tax, interest or any other amount paid under the existing law are to be disposed of in accordance with the provisions of existing law, with any amount eventually accruing to the claimant being paid in cash, subject to the statutory provisions specified therein.
The Tribunal noted that, although the refund claim arose in the transitional framework of Section 142(3), the provision itself required the claim to be disposed of under the existing law. In the present case, the existing law governing the refund was Section 11B of the Central Excise Act. Accordingly, the Tribunal observed that both the authorities below had rightly dealt with the refund under the erstwhile Central Excise law.
The mere fact that Section 142(3) of the CGST Act was the transitional provision under which the refund claim was made did not, by itself, bring the resulting appeal within the jurisdiction of GSTAT. Following the settled position, GSTAT dismissed the Revenue's appeal as not maintainable, while granting liberty to approach the appropriate forum, i.e. CESTAT.
Practical implications
The ruling is particularly relevant for taxpayers and the Department dealing with legacy CENVAT refund claims. Before filing an appeal, parties should examine the provision under which the impugned order has actually been passed, rather than relying solely on the provision under which the original refund claim was filed.
Where the refund order and the first appellate order have been passed under Section 11B of the Central Excise Act, the decision in Asish Kumar Pati indicates that the appropriate appellate forum is CESTAT. The decision also highlights the importance of examining the appellate direction contained in the order, although the statutory basis of the order remains the determining consideration.
Conclusion
The Maharashtra GSTAT's ruling in Asish Kumar Pati provides clarity on an important jurisdictional issue arising from the transition to GST. While Section 142(3) of the CGST Act provides the mechanism for dealing with specified legacy refund claims, it expressly requires such claims to be disposed of in accordance with the existing law.
Where the authorities have adjudicated the refund under Section 11B of the Central Excise Act and the resulting orders are passed under the erstwhile regime, the appellate remedy lies before CESTAT rather than GSTAT.
Case Citation: Asish Kumar Pati v. Director, APL/3/THN/2026, decided on 6 August 2026 (GSTAT, Maharashtra-Thane Bench).
