Section 120 of CGST Act - Appeal not to be filed in certain cases
Section 120 of the Central Goods and Services Tax Act, 2017 empowers the Central Board of Indirect Taxes and Customs (CBIC), on the recommendations of the GST Council, to prescribe monetary limits for departmental appeals and applications under Chapter XVIII of the CGST Act.
Updated: 15 September 2026
Text and meaning of Section 120
Section 120(1): The Board may, on the recommendations of the Council, issue orders, instructions or directions fixing monetary limits for regulating the filing of an appeal or application by an officer of central tax under Chapter XVIII.
Section 120(2): If the Department does not file an appeal or application because of such monetary-limit instructions, that non-filing does not prevent it from filing an appeal in another case involving the same or a similar issue or question of law.
Section 120(3): A party cannot argue that the Department accepted or acquiesced in a disputed legal position merely because no appeal was filed due to the monetary-limit policy.
Section 120(4): The Appellate Tribunal or court must take into account the circumstances in which an appeal or application was not filed pursuant to the Board's monetary-limit instructions.
The provision is therefore a litigation-management measure. It allows the tax administration to avoid low-value litigation without treating every unchallenged order as an acceptance of the legal proposition decided in that order.
Current monetary limits for departmental GST appeals
CBIC issued Circular No. 207/1/2024-GST dated 26 June 2024 under Section 120 read with Section 168 of the CGST Act. Subject to the exclusions discussed below, the prescribed limits are:
| Appellate forum | Monetary limit |
|---|---|
| Goods and Services Tax Appellate Tribunal (GSTAT) | Rs. 20,00,000 |
| High Court | Rs. 1,00,00,000 |
| Supreme Court | Rs. 2,00,00,000 |
These thresholds regulate appeals by Central Tax officers. They do not create a corresponding bar on a taxpayer's statutory right to appeal where the CGST Act otherwise permits an appeal.
How the disputed amount is calculated
For a dispute concerning tax together with interest or penalty, the aggregate disputed tax amount, including CGST, SGST or UTGST, IGST and Compensation Cess, is considered for the monetary threshold. If the dispute concerns only interest, penalty or late fee, the relevant amount - or their aggregate where more than one is involved - is considered. In an erroneous-refund dispute, the refund amount in dispute is considered.
The monetary limit applies to the disputed amount for which the proposed departmental appeal is contemplated. Where one composite order disposes of more than one appeal or demand notice, the circular requires the relevant amounts covered by the composite order to be considered together rather than separately for each individual appeal or notice.
Cases where the monetary limits do not control filing
The circular requires a decision on merits irrespective of the monetary limits in specified categories. These include cases where a GST statutory provision has been held unconstitutional; rules or regulations have been held ultra vires the parent Act; a Government or Board order, notification, instruction or circular has been held ultra vires; and recurring or interpretative disputes concerning matters such as valuation, classification, refunds or place of supply.
The exclusions also cover cases involving strictures, adverse comments or costs against the Government, Department or its officers, and any other case or class of cases which the Board considers necessary to contest in the interest of justice or revenue.
Exceeding the limit does not make an appeal automatic
A disputed amount above the prescribed threshold does not by itself require the Department to file an appeal. The circular states that filing must still be decided on the merits, keeping in view the objective of reducing unnecessary litigation and providing greater certainty to taxpayers.
Effect of non-filing: no precedent or acquiescence
Sub-sections (2) to (4) are important when an earlier favourable order is relied upon by a taxpayer. If the Department did not challenge that order only because the amount involved was below the prescribed monetary limit, the non-filing does not mean that the Department accepted the disputed legal issue. A similar issue may still be challenged in another case where the monetary threshold is crossed or where the case falls within an exclusion.
Section 120 within the CGST appeals framework
Section 120 forms part of Chapter XVIII, "Appeals and Revision". It should be read with provisions governing appeals to the Appellate Authority and Tribunal and further appeals to constitutional courts. For navigation, see Section 117 - Appeal to High Court, Section 118 - Appeal to Supreme Court, Section 119 - Sums due to be paid notwithstanding appeal, etc. and Section 121 - Non-appealable decisions and orders.
Frequently asked questions
What is Section 120 of the CGST Act?
It authorises CBIC, on GST Council recommendations, to prescribe monetary limits regulating departmental appeals or applications under the CGST appellate chapter.
What is the present GSTAT monetary limit for a departmental appeal?
Under Circular No. 207/1/2024-GST, the monetary limit is Rs. 20 lakh, subject to the circular's exclusions and merit-based decision requirements.
Does non-filing by the Department mean that it accepted the decision?
No. Section 120 expressly prevents non-filing under a monetary-limit instruction from being treated as acquiescence, and it preserves the Department's ability to contest the same or a similar issue in another appropriate case.
This page is a general legal information resource. The applicable Act, rules, notifications, circulars and case-specific facts should be checked before acting on a GST appeal matter.