Supreme Court: M/s Goodluck India Limited & Anr. v. Union of India & Ors.
[SLP (C) No. 24550 of 2025]
Rule 96(10) of the CGST Rules imposed restrictions on IGST refunds claimed by exporters who had availed exemption benefits on imports under specified notifications. The Rule was omitted with effect from 8 October 2024, without any saving clause, giving rise to the question whether the restriction could continue to apply to refund proceedings pending on the date of such omission.
The Hon’ble Supreme Court held that the omission of Rule 96(10), in the absence of a saving clause, extinguishes its applicability to proceedings that remained pending on the date of its omission. Consequently, refund claims pending on such date cannot be adjudicated by applying the restrictions contained in the omitted Rule. The Court further clarified that the GST Council’s recommendation for prospective application is advisory in nature and cannot override the effect of the notification as issued.
The Hon’ble Supreme Court upheld the view of the High Courts that the omission of Rule 96(10) of the CGST Rules applies to proceedings pending on the date of its omission. Relying on Kolhapur (2000) 2 SCC 536, the Court held that an omitted provision stands obliterated unless its operation is preserved by a saving clause or a statutory legal fiction. Since Rule 96(10) was omitted without any such saving provision, proceedings founded on the omitted Rule could not continue. The Court further noted the GST Council’s recommendation to omit the Rule on account of the complications arising from its operation and held that the recommendation for prospective omission was advisory and could not override the notification giving effect to the omission.
The judgment provides much-needed finality to refund proceedings affected by Rule 96(10) and clarifies the legal consequences of the omission of a statutory provision without a saving clause. The Supreme Court has reaffirmed that, in the absence of a specific saving or sunset clause preserving pending proceedings, an omitted rule cannot continue to govern matters merely because they were initiated while the rule remained in force. The ruling thus paves the way for the resolution of pending refund claims without the restrictions earlier imposed by Rule 96(10), bringing greater certainty and clarity to taxpayers.
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