Constitutional Challenge to GST Rule 89(5): Retrospective Amendment Limits Refund Claims for Differential Service Tax Structures

HC examined the constitutional validity of amended subrule [5] of Rule 89 in GST Rules, 2017. The court considered the retrospective effect preventing refund claims for differential service tax under inverted tax structure. Petitioner challenged the rule's legality, arguing it improperly restricts refund rights established by the CGST Act. Case was adjourned with notice returnable on specified date for further legal scrutiny.

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The petitioner challenged the vires of amended subrule [5] of Rule 89 of the Central Goods & Services Rules, 2017, which has retrospective effect. The rule prevents claiming refund of differential service tax in case of inverted tax structure of Servicetax. The petitioner argued that the Government cannot frame rules depriving a person of refund recognized by the Central Goods & Service Tax Act, 2017. Notice returnable on 25th October 2018.

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