Facts of the case:

In this case, the petitioners engaged in the export of goods , were subjected to proceedings by the GST authorities on allegations of wrongful availment of refund of Integrated Goods and Services Tax (IGST) on exports, purportedly in violation of Rule 96(10) of the CGST Rules, 2017. The proceedings were initiated based on intelligence received from customs authorities, followed by issuance of summons and show cause notices. The adjudicating authority subsequently passed orders denying refund claims.

The petitioners had earlier challenged the constitutional validity of Rule 96(10), and the High Court had already examined similar issues in prior judgments. Meanwhile, a significant legal development occurred when Notification No. 20/2024 dated 08.10.2024 omitted Rule 96(10) from the CGST Rules without incorporating any saving clause. The petitioners contended that in light of such omission and judicial precedents, all proceedings initiated under the said rule, which had not attained finality, would automatically lapse. Since the petitioners’ cases were still pending either at adjudication or challenge stage, they approached the High Court seeking quashing of the impugned orders.

Issue:

Whether the omission of Rule 96(10) of the CGST Rules, 2017 by Notification No. 20/2024 (without any saving clause) would apply to pending proceedings and invalidate show cause notices, adjudication orders, and recovery actions initiated under the said rule, even if such proceedings were initiated prior to its omission.

Held that:

The Court held that the issue is no longer res integra and is squarely covered by earlier judgments of the High Court as well as persuasive precedent from other High Courts. It was observed that the omission of Rule 96(10) without a saving clause has the effect of completely obliterating the rule from the statute book, in line with settled principles of statutory interpretation.

Relying on established legal doctrines and judicial precedents, particularly the principle that repeal of a provision without a saving clause renders it non-existent except for “transactions past and closed,” the Court held that all pending proceedings which have not attained finality would be governed by the law as it exists at the time of decision. Consequently, Rule 96(10), having been omitted, cannot be relied upon to sustain any ongoing proceedings.

The Court further clarified that proceedings would be considered “pending” if they are still under adjudication, appeal, or judicial scrutiny and have not reached finality. Since the petitioners had approached the High Court and the GST Appellate Tribunal was not constituted, the impugned orders could not be treated as final. Therefore, such proceedings do not fall within the exception of “transactions past and closed.”

In view of the above, the Court concluded that the impugned show cause notices and adjudication orders, being solely based on Rule 96(10), cannot survive after its omission. Accordingly, the impugned orders were quashed and set aside, and the petitioners were held entitled to claim refund of IGST paid on exports in accordance with law. The authorities were directed to process the refund claims within a stipulated time.

Case Name: M/s. Rohan Dyes And Intermediates Limited Versus Union of India & ANR. dated 12.03.2026

To read the complete judgement 2026 Taxo.online 645