Shilpa Medicare Ltd Vs Union of India (Karnataka High Court)
Summary: The Karnataka High Court, Kalaburagi Bench, allowed M/s Shilpa Medicare Ltd’s writ petition and quashed show cause notice No. 50/2023-24 GST PREV dated 18.01.2024, together with all proceedings arising from it. The petitioner had challenged the notice and the restriction in Rule 96(10) of the Central Goods and Services Tax Rules, 2017, concerning the refund route for integrated tax paid on exports. It also sought consideration of its reply dated 25.02.2025 and its request concerning reassessment of IGST on imports, interest and refund claims.
The Court heard counsel for the petitioner, the Union of India and the other respondents. It found the controversy directly covered by its earlier order in M/s Hikal Limited Vs Union of India and others, W.P.No.15251 of 2020, dated 09.12.2025. The present order reproduces that earlier ruling at length. In Hikal, the Court examined decisions of the Kerala, Uttarakhand, Gujarat, Bombay and Delhi High Courts on the former Rule 96(10), its omission through the notification dated 08.10.2024, and the effect of that omission on pending notices, orders and refund disputes.
The quoted Kerala High Court ruling in Sance Laboratories held Rule 96(10), as inserted by Notification No.53/2018-CT with effect from 23.10.2017, ultra vires Section 16 of the IGST Act. The quoted Uttarakhand ruling held that an order founded on the rule could not be made after its unconditional omission. The Gujarat, Bombay and Delhi decisions discussed the absence of a saving clause and its implications for proceedings that had not attained finality. The earlier Karnataka order applied those rulings to quash the notice before it and directed refund of ₹75,55,123 with applicable interest within three months. That refund direction was part of the quoted Hikal order; it is not a direction made in Shilpa Medicare’s case.
