Union of India Vs ABB Global Industries And Services Private Limited (Karnataka High Court)
Summary: The Revenue filed an appeal against the order dated 09.12.2025 passed by the learned Single Judge in Writ Petition No. 23839/2023 (T-RES), whereby the respondent was directed to receive a refund of `29,57,43,039/- towards Integrated Goods and Services Tax (IGST) paid on export of services during December 2019. The respondent had challenged Rule 96(10) of the CGST Rules, 2017 and the order-in-appeal dated 28.08.2023 rejecting its refund claim. During pendency of the writ petition, Rule 96(10) was omitted by notification dated 08.10.2024. The Revenue contended that the omission was prospective and therefore did not affect refunds relating to the earlier period. The learned Single Judge, following M/s Hikal Limited vs. Union of India and others, directed grant of refund. In appeal, the Revenue relied upon the subsequent Supreme Court decision in Goodluck India Limited and Another vs. Union of India and others. The Supreme Court, following the Constitution Bench decision in Kolhapur Canesugar Works Ltd. v. Union of India, held that proceedings under an omitted rule cannot continue in the absence of a saving or sunset clause. Since Rule 96(10) was omitted without any saving clause, the proceedings under the omitted rule could not be kept alive. The Karnataka High Court accordingly found no ground to interfere with the impugned order and dismissed the Revenue’s appeal. The pending interlocutory application was also disposed of.
Cases Discussed
- M/s Hikal Limited vs. Union of India and others — Writ Petition No. 15251/2020, dated 09.12.2025
- Goodluck India Limited and Another vs. Union of India and others — 2026 SCC OnLine SC 1523
- Kolhapur Canesugar Works Ltd. v. Union of India — (2000) 2 SCC 536
Full Text of the Judgment/Order
1. For the reasons stated in the application, I.A No.2/2026, the same is allowed. The delay of 148 days in filing the appeal is condoned. 2. The Revenue has filed the present appeal, impugning an order dated 09.12.2025 passed by the learned Single Judge in Writ Petition No. 23839/2023 (T-RES). The respondent filed the said writ petition, inter alia, impugning Rule 96(10) of the Central Goods and Services Tax Rules, 2017 [CGST Rules]. Additionally, the respondent challenged the order-in-appeal dated 28.08.2023, passed by the Commissioner, Central Tax (Appeals) [CCT(A)], rejecting the respondent’s appeal. The respondent had appealed against an order rejecting its application for a refund of `29,57,43,039/- on account of the Integrated Goods and Services Tax [IGST] paid on the export of services during the month of December 2019. The respondent’s application for refund was rejected by virtue of Rule 96 of the CGST Rules read with Section 54 of the CGST Act. 3. It is stated that during the course of the writ petition, Rule 96(10) of the CGST Rules was deleted by a notification dated 08.10.2024. However, the Revenue argues that the said notification is prospective and does not affect refunds claimed for the earlier period. 4. The learned Single Judge, following an earlier decision of 1 this Court in M/s Hikal Limited vs. Union of India and others directed grant of refund. 5. The learned counsel appearing for the Revenue handed over a recent decision of the Supreme Court in Goodluck India Limited 2 and Another vs. Union of India and others, whereby the said issue stands authoritatively settled. The Supreme Court following the Constitution Bench decision in Kolhapur Canesugar Works 3 Ltd. v. Union of India held that the proceedings under an omitted rule could not be continued. The Supreme Court found that since there was no savings clause or a sunset clause in respect of Rule 96 (10) of the CGST Rules proceedings, the said rule could not be kept alive. Paragraph 7 of the said decision is set out below:
“7. The Constitution Bench decision applies squarely in the above case. We may also observe that even going by the recommendations as extracted hereinabove, sub-rule (10) of Rule 96 was omitted because it was ‘leading to unnecessary complications without any intended benefit being served’ (sic). As fairly submitted by the learned ASG the legislature has not brought in any saving clause or a sunset clause, when sub-rule (10) of Rule 96 was omitted. The recommendation that the omission should be prospective is also 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.”
6. In view of the above, we find no ground to interfere with the impugned order. The appeal is, accordingly, dismissed. 7. The pending interlocutory application also stands disposed of. Notes:- 1Writ Petition 15251/2020 dated 09.12.2025 22026 SCC OnLine SC 1523 3(2000) 2 SCC 536
