Sance Laboratories Private Limited Vs Union Of India (Kerala High Court)
Kerala High Court held that rule 96(10) of the Central Goods and Services Tax Rules, 2017 [CGST Rules] as inserted by notification 53/2018-CT dated 09-10-2018 effective from 23-10-2017 is ultra vires of provisions of section 16 of the Integrated Goods and Services Tax Act, 2017 [IGST Act].
Facts- These writ petitions are filed challenging the validity of Rule 96(10) of the Central Goods and Services Tax Rules, 2017 (CGST Rules) primarily on the ground that the Rule is ultra vires the provisions of Section 16 of the Integrated Goods and Services Tax Act, 2017 (IGST Act).
Conclusion- Held that Rule 96(10) of the CGST Rules, as inserted by notification 53/2018-CT dated 09-10-2018 w.e.f. 23-10-2017 is declared ultra vires the provisions of Section 16 of the IGST Act and unenforceable on account of being manifestly arbitrary. As a consequence of the above declaration, any action that has been initiated by the issuance of a show cause notice or otherwise or has culminated in an order against the petitioners in these writ petitions on the basis of the provisions contained in Rule 96(10) of the CGST Rules, as inserted by notification No.53/2018-CT dated 09-10-2018 w.e.f. 23-10-2017, will stand quashed.
