GST Appellate Tribunal possesses inherent and incidental power to grant interim stay on recovery proceedings.

The Petitioner challenged a tax liability confirmed via an Order-in-Original on December 18, 2023, which was subsequently upheld by the Appellate Authority on June 12, 2024.

The Petitioner filed a second appeal before the Goods and Services Tax Appellate Tribunal (GSTAT) on February 5, 2026.

Despite the pending appeal and the Petitioner’s claim of having deposited the requisite pre-deposit via Form GST DRC-03A, the Revenue issued a Recovery Notice dated February 6, 2026.

The Petitioner approached the High Court under Article 226, contending that the CGST Act lacks express provisions empowering the Tribunal to grant interim stay orders.

Whether the Goods and Services Tax Appellate Tribunal (GSTAT), as constituted under the CGST Act, 2017, has the jurisdiction and power to pass interim orders, including staying recovery proceedings during the pendency of an appeal.

The Court primarily interpreted Sections 111 and 113 of the Central Goods and Services Tax Act, 2017 (CGST Act).

Section 111(1) empowers the Tribunal to regulate its own procedure, and Section 113(1) authorizes it to pass such orders "as it thinks fit".

The Court further relied on the Inherent Powers and Interlocutory Applications under Rules 10 and 29 of the Goods and Services Tax Appellate Tribunal (Procedure) Rules, 2025.

Additionally, it applied the precedent set in ITO v. M. K. Mohammed Kunhi [1968 SCC OnLine SC 71], which established that an express grant of appellate power carries a necessary implication of the authority to grant a stay to make the remedy effective.

The Court rejected the Petitioner's argument that the absence of an explicit "stay power" provision in the statute rendered the Tribunal's appellate remedy illusory.

It reasoned that under Section 113(1), the phrase "pass such orders as it thinks fit" includes the incidental and inherent power to grant interim relief to ensure the appeal’s purpose is not defeated by recovery actions.

Any other interpretation would erroneously force the High Court to act as a perpetual forum for interim relief in matters within the Tribunal's domain.

The Court also highlighted that the GSTAT (Procedure) Rules, 2025 explicitly provide for "Interlocutory Applications" for stay (Rule 29) and affirm the Tribunal’s "Inherent Powers" (Rule 10) to meet the ends of justice.

The High Court declined to interfere on merits, directing the Petitioner to move an interim application before the Tribunal.

However, noting that the electronic portal might not currently support such filings, the Court permitted manual filing and directed the Registry to update the portal.

To allow the Petitioner to approach the Tribunal, the Court granted a limited stay on the Recovery Notice dated February 6, 2026, for two weeks.

The Petition was disposed of accordingly.