SC confirms omission of Rule 96(10) applies to even pending proceedings absence any saving clause

 This Tax Alert summarizes a recent judgement of the Supreme Court (SC)^[1] dealing with the effect of omission of Rule 96(10) of the Central Goods and Services Tax Rules, 2017 (CGST Rules) on any proceedings pending disposal on the date of such omission.

Rule 96(10) inter alia restricted any person from claiming refund of integrated tax paid on export of goods or services if benefit of specified exemption notifications was availed. The said rule was omitted w.e.f. 8 October 2024^[2].

Subsequently, the Gujarat High Court (HC)^[3] held that such omission will be applicable to all proceedings/cases which are pending for final adjudication either before courts or adjudicating authorities. Revenue filed an appeal before SC.

The key observations of the SC are:

• Rule 96(10) was omitted without any saving clause for its continuation w.r.t pending proceedings.
• Omission of a rule obliterates it from the statute book unless its applicability to pending proceedings is expressly saved. Further, Section 6 of the General Clauses Act, 1897, which saves repeal of a Central Act or Regulation, is not applicable to omission of rules^[4].
• The GST Council’s recommendation to omit Rule 96(10) prospectively was recommendatory and not binding on the rule making authority.
• Rule 96(10) created unnecessary complications without serving any intended benefit. In the absence of a saving clause, such complications cannot be kept alive for pending proceedings.

Basis above, SC upheld the Gujarat HC ruling and dismissed Revenue’s appeals. It also directed circulation of the order to all HCs for expeditious disposal of similar pending matters.

Comments:

• The Apex Court ruling is significant as it settles the position on applicability of omitted provision to pending cases in the absence of a saving clause.
• It is likely to benefit exporters whose refund claims were disputed on account of availment of specified exemption notifications and the proceedings are currently pending.

^{1 TS-575-SC-2026-GST
2 Notification No. 20/2024 dated 8 October 2024
3 TS-525-HC(GUJ)-2025-GST}