Appellate Appeals Against Refund Rejection Orders Under Section 142(3) Lie Before CESTAT, Not GSTAT

By | August 11, 2026
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Appellate Appeals Against Refund Rejection Orders Under Section 142(3) Lie Before CESTAT, Not GSTAT

Appellate Appeals Against Refund Rejection Orders Under Section 142(3) Lie Before CESTAT, Not GSTAT

Issue

Whether the Goods and Services Tax Appellate Tribunal (GSTAT) has jurisdiction under Section 112 of the CGST Act, 2017 to entertain an appeal against a refund order passed under Section 142(3) read with Section 11B of the Central Excise Act, 1944, or if such appeal lies exclusively before CESTAT.

Facts

  • Original Orders: Both the Order-in-Original and the First Appellate Order were passed under Section 11B of the Central Excise Act, 1944 read with the Cenvat Credit Rules.
  • Refund Claim: The respondent claimed a cash refund of accumulated Cenvat credit under Section 11B of the Central Excise Act, 1944, in terms of transitional provisions under Section 142(3) of the CGST Act, 2017.
  • Forum Query: The GSTAT Bench raised a preliminary query regarding its jurisdiction, questioning whether CESTAT was the appropriate appellate forum instead of GSTAT.
  • Revenue’s Contention: The Revenue argued that since the refund claim was governed by Section 142(3) of the CGST Act, 2017, the appeal was maintainable before the GSTAT.

Decision

  • Disposal Under Existing Law: The Tribunal noted that Section 142(3) explicitly mandates that claims for refund of unutilized Cenvat credit must be disposed of in accordance with the provisions of existing law, specifically Section 11B of the Central Excise Act, 1944.
  • Reliance on CESTAT Larger Bench: The Tribunal relied on the settled legal position rendered by a Larger Bench of CESTAT, which held that appeals arising from refund/credit rejection orders passed under Section 142(3) lie exclusively before CESTAT.
  • Dismissal for Lack of Jurisdiction: The GSTAT held that it had no jurisdiction to entertain the appeal, dismissed the Revenue’s appeal as not maintainable, and granted liberty to approach the appropriate forum (CESTAT).

Key Takeaways

  • Exclusive Jurisdiction of CESTAT for Transitional Refunds: Rejection of refund claims filed under Section 142(3) of the CGST Act must be appealed before CESTAT, as the substantive adjudication remains anchored to Section 11B of the Central Excise Act, 1944.
  • GSTAT Cannot Overstep Existing Law Mandates: Transitional provisions maintaining the mechanism of “existing law” preserve the legacy appellate hierarchy for disputes rooted in pre-GST statutes.
  • Liberty to Re-file: Dismissal of an appeal by GSTAT on jurisdictional grounds does not foreclose the Revenue or assessee’s right to seek remedy before the proper appellate forum.
GOODS AND SERVICE TAX APPELLATE AUTHORITY , THANE BENCH
Asish Kumar Pati
v.
Kairav Chemofarbe Industries Ltd.
Ramesh Nair, Judicial Member
and Prallhad S. Paranjape, Technical Member
APL/3/THN/2026
AUGUST  6, 2026
Ghanshyam Kumar, Counsel Asstt. Commissioner for the Appellant. Hemant Regmi, Counsel, CA for the Respondent.
ORDER
Ramesh Nair, Judicial Member. – This appeal is listed for regular hearing and final disposal of the appeal filed by the revenue. On going thru the records of the appeal, we find that the Order-in-Original as well as the first appellate order were passed under the erstwhile Central Excise Act, 1944 read with the Cenvat Credit Rules, 2004.
QUESTION OF LAW:
2. The question of law involved in this case for our consideration is whether on the issue of refund of unutilized cenvat credit availed under the erstwhile Cenvat Credit Rules, 2004 in terms of Section 142(3) of CGST Act, 2017, the appeal lies before this GSTAT or otherwise?
3. The issue in brief is the respondent claimed refund of accumulated/unutilised cenvat credit in cash under section 11B of the Central Excise Act, 1944 in terms of Section 142(3) of CGST Act, 2017. The bench raised a query that this Tribunal is not the right forum for appeal, whereas the appeal should have filed before CESTAT.
4. Shri Ghanshyam Kumar, learned Assistant Commissioner, Authorised Representative appearing for the revenue appellant, answering the query, submits that issue is of refund under Section 142(3) of CGST Act, hence appeal is maintainable in this GST Appellate Tribunal.
5. On the other hand, Shri Hemant Regmi, learned Chartered Accountant, appearing on behalf of the respondent, at the outset submits that firstly the preamble of the impugned order itself directs to file appeal before the Customs, Excise & Service Tax Appellate Tribunal, and secondly both the orders passed by the Adjudicating Authority and first Appellate Authority under the erstwhile Central Excise Act, 1944. Therefore, this GST Appellate Tribunal has no jurisdiction to entertain this appeal.
6.1 We have carefully considered the submissions made by both the sides and perused the records. We find that undisputedly, both the orders of the authorities below were passed under section 11B of the Central Excise Act, 1944 being the issue involved is cash refund of accumulated and unutilized cenvat credit availed under the erstwhile Cenvat Credit Rules, 2004 in terms of Section 142(3) of the CGST Act, 2017. As regard the plea of the learned AR that issue is of Section 142(3) of CGST Act, 2017, for ease of reference the said section is reproduced below:
Section 142 (3)
Every claim for refund filed by any person before, on or after the appointed day, for refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under the existing law, shall be disposed of in accordance with the provisions of existing law and any amount eventually accruing to him shall be paid in cash, notwithstanding anything to the contrary contained under the provisions of existing law other than the provisions of sub-section (2) of section 11B of the Central Excise Act, 1944.
6.2 As per the above provision, the refund even though provided in terms of Section 142(3) of the CGST Act, 2017 but it explicitly provides that the same needs to be disposed of in accordance with the provisions of existing law, in particular section 11B of Central Excise Act, 1944. Therefore, both the authorities below have righty disposed off the matter under the erstwhile Central Excise Act, 1944. The similar issue regarding jurisdiction of Tribunal in the case of refund of unutilised cenvat credit in terms of Section 142(3) of CGST, 2017 came up before the CESTAT wherein the larger bench of CESTAT at Chennai in the case of Bosch Electrical Drive India Pvt. Ltd. v. Commissioner of Central Tax 2024 (390) E.L.T. 652 (Tri.-LB) ruled that appeals against refund/credit rejection orders passed under Section 142(3) of the CGST Act, 2017 lie maintainable before the CESTAT.
6.3 As per our above discussion and finding with the settled legal position, we are of the firm view that in the captioned matter this GSTAT has no jurisdiction to entertain this appeal. Accordingly, the revenue’s appeal is dismissed as not maintainable before this Tribunal, with liberty to approach the right forum i.e. CESTAT and the same shall be dealt with in accordance with law.