The Case
M/S GOODLUCK INDIA LIMITED VS UNION OF INDIA
Case No.: SLP(C) No.-024550 – 2025
Decided on: 08/06/2026
Diary No.: 40513/2025 ·
Supreme Court of India
The Legal Issue Before the Supreme Court
The issue arising is whether sub-rule (10) of Rule 96 as omitted by Notification No.20/2024 with effect from 08.10.2024 would inure to the benefit of the assessee in the pending proceedings, wherein there was a claim of refund of integrated tax paid on goods and services exported out of India, to be considered without the restriction under sub-rule (10) being applied. The High Court had held the omission of Rule 96(10) of the Central Goods and Services Tax (CGST) Rules, 2017 to be applicable to every pending proceeding as on the date of its omission. The assessees challenged the vires and validity of Rule 96(10), which the High Court had refused to consider since it was applied to all pending proceedings.
Facts of the Case
The Union of India and the Department challenged the impugned judgment having held the omission of Rule 96(10) of the CGST Rules, 2017 to be applicable to every pending proceeding as on the date of its omission. In two SLPs by the assessees, numbered as SLP (C) No.24550 of 2025 and SLP(C) No.26411 of 2026, the challenge was against the very vires and validity of Rule 96(10), which the High Court had refused to consider, since it was applied to all pending proceedings. Sub-rule (10) of Rule 96 was omitted by Notification No.20/2024 with effect from 08.10.2024. The minutes of the 54th meeting of the GST Council held on 09th September, 2024 recorded the Law Committee's observation that operation of rule 96(10) was leading to unnecessary complications without any intended benefit being served, and recommended that rule 96(10), rule 89(4A) and rule 89(4B) of the CGST Rules, 2017 may be omitted with prospective effect. The learned ASG fairly conceded that the recommendation is only advisory and it is not mandatory to accept it.
Summary of the Decision
The Constitution Bench decision in Kolhapur Canesugar Works Ltd v. Union of India applies squarely, and the effect of repealing a statute or deleting a provision is to obliterate it from the statute book as completely as if it had never existed. On omission of a rule, proceedings initiated under the omitted rule could be continued only if there was a provision for continuance of the proceedings already initiated or if by incorporation of a provision in the statute there was a legal device adopted, creating a fiction by virtue of which such proceedings could be continued. The legislature has not brought in any saving clause or a sunset clause when sub-rule (10) of Rule 96 was omitted, and the recommendation that the omission should be prospective is advisory in nature and does not bind the rule making authority. The intention to omit the rule without any saving clause was to bring to an end the unnecessary complications once and for all, and the intention cannot be to keep alive the unnecessary complications insofar as the pending proceedings are concerned. The two SLPs by the assessees, numbered SLP (C) No.24550 of 2025 and SLP(C) No.26411 of 2026, are dismissed as infructuous; leave is granted in the rest of the matters and the appeals are dismissed. The Court found no good reason to interfere with the well-reasoned judgment of the High Court, and hoped that the many proceedings pending before the various High Courts, on which conflicting decisions have also been passed, would get closure with this judgment. The Registry is directed to send a copy of this order to all the High Courts, and the Registry of the High Courts will ensure that the cases relating to the subject issue of omission of Rule 96(10) would be placed before the Courts having roster, after taking appropriate orders from the Hon'ble Chief Justice of the respective High Courts, expeditiously to bring quietus in the subject litigation. Pending application(s), if any, shall stand disposed of.
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