Gujarat High Court Holds Omission of Rule 96(10) of CGST Rules Applies to All Pending Proceedings; Refund Claims Must Be Processed

Background and Context
The petitioners, members of the Gujarat Dyestuff Manufacturers’ Association, challenged orders issued by the tax authorities denying their refund claims for Integrated Goods and Services Tax (IGST) on the ground of alleged violation of Rule 96(10) of the Central Goods and Services Tax Rules, 2017 (CGST Rules). The authorities had initiated proceedings based on intelligence inputs and issued show-cause notices without considering the petitioners’ replies. The petitioners also challenged the constitutional validity of Rule 96(10) in earlier writ petitions.

Legal Issue and Precedent
The central issue before the Gujarat High Court was whether the omission of Rule 96(10) of the CGST Rules by Notification No. 20/2024 dated 8 October 2024, which did not contain a saving clause, would apply to pending proceedings, including refund claims and show-cause notices that had not reached finality.

The Court noted that the issue was squarely covered by its earlier decision dated 20 November 2025 in Special Civil Application No. 3081 of 2025 and allied matters, which in turn relied on the judgment in Special Civil Application No. 22519 of 2019 and the Bombay High Court’s decision in Hikal Limited & Ors. v. Union of India & Ors.

Court’s Reasoning
The Court observed that the omission of Rule 96(10) by Notification No. 20/2024 was prospective but, in the absence of a saving clause, the common law principle regarding repeal would apply. This principle, as explained in authoritative texts and judicial precedents, holds that a repealed provision is treated as if it never existed, except for transactions that are “past and closed.” As a result, all pending proceedings—including undisposed show-cause notices, orders not yet finalized due to appeals, or challenges before the Court—would not be preserved and would stand lapsed.

The Court further clarified that, since the Appellate Tribunal had not been constituted, the petitioners had no alternative remedy, and thus, the orders under challenge could not be considered final or “past and closed.”

Legal Principle and Outcome
The Gujarat High Court held that the omission of Rule 96(10) applies to all pending proceedings as of 8 October 2024. Consequently, the impugned orders and show-cause notices issued under the now-omitted Rule 96(10) were quashed and set aside. The Court directed the authorities to process all pending IGST refund applications in accordance with Rule 96 of the CGST Rules, 2017, within twelve weeks from the date of receipt of the order.

Conclusion
This decision reaffirms the principle that, in the absence of a saving clause, the repeal or omission of a statutory provision renders it inapplicable to all pending proceedings, and affected parties are entitled to relief accordingly. The ruling provides clarity on the legal effect of the omission of Rule 96(10) and ensures that exporters’ refund claims are not denied on the basis of a provision that no longer exists in law.