Refund Proceedings Based on Omitted Rule 96(10) Quashed Without Saving Clause

Centax Editorial Board

May 30, 2026

• 2 min. read

Case Details: Techno Waxchem Pvt. Ltd. vs. Union of India (2026) 42 Centax 433 (Cal.)

Judiciary and Counsel Details

- Raja Basu Chowdhury, J.
- S/Shri Vinay Kumar Shraff, Harsh Gadodia & Dev Kumar Agarwal, for the Petitioner.
- S/Shri Bhaskar Prosad Banerjee, Tapan Bhanja, Tanoy Chakraborty, Partha Sarathi Banerjee & Saptak Sanyal, for the Respondent.

Facts of the Case

The petitioner, a GST-registered exporter, procured duty-free inputs under the Advance Authorisation Scheme and exported goods as zero-rated supplies. Refunds of IGST were granted against ICEGATE shipping bills. Subsequently, the department alleged a violation of Rule 96(10) of the CGST Rules on the ground that the petitioner had availed a refund despite procuring duty-free inputs under Advance Authorisation. Based on this, the department issued a SCN under section 74 of the CGST Act. The Proper Officer confirmed the demand under section 74(9) and issued DRC-07. The petitioner challenged these proceedings before the High Court, contending that Rule 96(10) had been omitted by Notification No. 20/2024, dated 08-10-2024, without any saving clause. Therefore, proceedings based solely on the omitted rule could not survive.

High Court Held

The High Court held that the entire proceedings rested exclusively on the alleged contravention of Rule 96(10). It was observed that Rule 96(10) stood omitted without any saving clause. Therefore, proceedings founded solely on the said rule could not continue after its omission. The High Court further observed that section 6 of the General Clauses Act applies to the repeal of a Central Act or Regulation, and not to the omission of rules. Since the proceedings and orders were based only on the omitted rule, they no longer survived after the omission of Rule 96(10). Accordingly, the order-in-original and consequential proceedings were quashed.

List of Cases Cited

- Addwrap Packaging (P.) Ltd. v. UOI — [2025] 175 taxmann.com 592 (Gujarat) = 2025 110 GST 736 (Gujarat) = 2025 98 G.S.T.L. 241 (Gujarat) — Followed [Para 31]
- Hikal Ltd. v. UOI — (2025) 34 Centax 249 (Bom.) — Followed [Para 31]
- Kolhapur Canesugar Works Ltd. v. UOI — 2000 (119) E.L.T. 257 (S.C.) — Referred [Para 20]
- Rayala Corporation (P) Ltd. and M.R. Pratap v. Director of Enforcement — (1969) 2 SCC 412 — Referred [Para 20]
- Vinayak International Housewares Pvt. Ltd. v. Union of India W. P. (C) 3154/2023, W. P. (C) 10687/2023 & CMAPPL. 41448/2023, W. P. (C) 3165/2023 decided on 20th November, 2025 — Followed [Para 31]