A significant procedural issue is increasingly being witnessed in GST litigation, particularly in the context of appeals before the Goods and Services Tax Appellate Tribunal (GSTAT). The problem arises in cases where liability is imposed not only on a registered taxable person but also on individuals such as directors, partners, or other persons who are not registered under GST. While the law clearly contemplates separate liability and independent remedies, the procedural framework does not seamlessly support such situations.
Rule 18(3) of the GSTAT Procedure Rules, 2025 mandates that where an impugned order pertains to more than one person, each aggrieved person is required to file a separate appeal and joint appeals are not maintainable. This position is consistent with the scheme of the GST law, particularly in cases involving invocation of Section 74 and penalty provisions under Section 122(1A), where individuals are fastened with independent liability. Therefore, a director or any such person against whom liability is imposed cannot ride on the appeal filed by the company and must independently approach the appellate forum.
However, the difficulty arises from the fact that all GSTAT appeals are required to be filed online through the prescribed portal. While a registered taxpayer can easily access the portal using its GST credentials, an unregistered person has no such access. This creates a fundamental procedural gap: although the law grants a right to appeal, the mechanism to exercise that right is not readily available.
Reference is often made to Rule 16A of the CGST Rules, which provides that a person not liable for registration may be granted a Temporary Identification Number (TIN) by the proper officer, and such registration is to be issued in Part B of Form GST REG-12. However, the language of the rule is discretionary, using the expression “may”, and is not specifically designed to address appellate requirements. More importantly, the GSTN portal currently facilitates generation of Temporary ID primarily in cases such as refund claims or advance ruling applications. There is no clear or structured facility enabling an unregistered person to obtain a Temporary ID for the purpose of filing an appeal before GSTAT.
This issue came up for consideration before the Telangana High Court in Bharat Kumar Agarwal v. Joint Commissioner (AE), W.P. Nos. 9166 and 9354 of 2026, decided on 08.04.2026. In that case, liability was imposed both on a company and its Managing Director through a composite order passed under Section 74 of the CGST Act. The Managing Director, being an unregistered person, sought to challenge the order independently. The Court recognised that since separate liability had been imposed, the Managing Director was entitled to file a separate appeal. At the same time, the Court acknowledged the procedural difficulty arising from lack of registration.
To address this, the Court directed that the Managing Director be permitted to apply for a temporary registration/identification number and that the authorities should issue the same within a stipulated time. The Court further directed that separate DRC-07 forms be issued for the company and the individual so as to enable both to independently pursue their appellate remedies. Significantly, the Court also clarified that the limitation period for filing appeal would run only after issuance of such separate orders. This approach ensured that the right to appeal was not rendered illusory due to procedural constraints .
A similar concern was echoed by the Allahabad High Court in Writ Tax No. 1235 of 2026 (order dated 13.03.2026), where the Court emphasised that the GST system must remain sensitive to the need to provide effective access to justice to any aggrieved person. The observations reflect a broader principle that procedural frameworks, especially in a digital regime, must facilitate rather than frustrate statutory remedies.
From a practical perspective, this issue is far from isolated. In many proceedings, particularly under Section 74, it is common for notices and orders to be issued in a composite manner, covering both the entity and its officers. In such cases, unless separate summaries of orders are issued and a workable mechanism for obtaining Temporary ID is provided, the affected individuals are left in a state of procedural uncertainty. The process then becomes dependent on approaching the department, making physical applications, and seeking discretionary relief, which is contrary to the objective of a streamlined digital tax administration.
This situation highlights a clear disconnect between the substantive provisions of the law and the procedural infrastructure supporting it. While the law recognises independent rights and liabilities, the system does not fully enable independent access to appellate remedies. Unless addressed through appropriate technological and administrative interventions, this gap has the potential to generate avoidable litigation and delay in justice delivery.
In conclusion, the issue of Temporary Identification for unregistered persons is not merely a technical concern but a substantive one, affecting the very ability of an aggrieved person to challenge an adverse order. In a regime that places significant reliance on digital processes, it is imperative that the system evolves to ensure that the right to appeal remains real, effective, and accessible to all persons, whether registered or otherwise.
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