Court Stays Proceedings on Retrospective Effect of CGST Rule 96(10), Future Hearing to Address Constitutional Concerns.

The HC issued a notice to the respondents and stayed proceedings related to impugned notices based on Notification No.54/2018's retrospective application. The petitioners contested the retrospective effect of Rule 96(10) of the CGST Rules, arguing it violates Article 14. The Court will address these concerns in the next hearing.

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Issues:
1. Interpretation of Rule 96(10) of the CGST Rules as amended by Notification No.54/2018-Central Tax dated 9.10.2018.
2. Jurisdiction and legality of giving retrospective effect to Notification No.54/2018.
3. Applicability of Notification No.54/2018 from the date of its publication or retrospectively from 23.10.2017.
4. Challenge to impugned notices issued based on retrospective operation of the notification.

Analysis:
1. The petitioners sought a declaration that Rule 96(10) of the CGST Rules, as amended by Notification No.54/2018, should be applied prospectively from the date of the notification. They argued that giving retrospective effect to the notification is without jurisdiction, arbitrary, and violates Article 14 of the Constitution of India.

2. The Coordinate Bench previously addressed a similar issue in Special Civil Application No.15833 of 2018. The Bench held that Notification No.54/2018 should be effective from 23.10.2017, not prior to the inception of Rule 96(10) of the CGST Act. This interpretation clarified the applicability of the notification.

3. The petitioners' counsel highlighted that the notification itself states it will come into force from the date of its publication in the official gazette. They argued that the Department's indiscriminate issuance of notices based on the notification's retrospective application from 23.10.2017 needs reconsideration.

4. In response to the arguments raised, the Court decided to issue notice to the respondents, returnable on a specific date, to address the concerns raised by the petitioners regarding the retrospective effect of the notification. The Court also stayed further proceedings pursuant to the impugned notices until the next hearing date.

This detailed analysis of the judgment provides a comprehensive overview of the issues involved and the Court's decision to address the interpretation and legality of the retrospective application of Notification No.54/2018 in relation to Rule 96(10) of the CGST Rules.

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