TaxTMI 
TaxTMI 
Omission of Rule 96(10) of the CGST Rules and Its Effect on Pending Integrated Tax Refund Proceedings
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....s an enactment, not where subordinate legislation omits a rule. • The removal of Rule 96(10) does not dispense with the independent statutory and procedural requirements governing export refunds under Section 54 of the CGST Act and Rule 96. Background & Context Rule 96 provides the framework for refund of integrated tax paid on goods or services exported out of India. In relation to export of goods, Rule 96 treats the shipping bill filed by an exporter as a deemed refund application. The application is deemed to have been filed only after the export manifest, export report or departure manifest covering the shipping bill is filed, the applicant furnishes a valid return in FORM GSTR-3B, and Aadhaar authentication is completed in the prescribed manner. For export of services, Rule 96(9) requires an application in FORM GST RFD-01, to be dealt with under Rule 89. Prior to its omission, Rule 96(10) imposed a distinct restriction upon the refund route involving payment of integrated tax on exports. In substance, it provided that a person claiming such refund should not have: "received supplies" on which the benefits under specified notifications had been availed; or....
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.... the eligibility of persons claiming refund of integrated tax paid on exports. Its omission thus bears directly on the eligibility determination in pending matters, while leaving the other statutory conditions, safeguards and verification requirements intact. Section 6 of the General Clauses Act and the distinction between an Act, Regulation and Rule Section 6 of the General Clauses Act, 1897 applies where the Act itself, or a Central Act or Regulation, repeals an enactment. Unless a contrary intention appears, the repeal does not affect prior operation, accrued rights, obligations or liabilities, or an investigation, legal proceeding or remedy concerning them. The operative saving in clause (e) permits such proceeding or remedy to be "instituted, continued or enforced" as if the repealing Act or Regulation had not been passed. Its textual limits are material. Section 3 of the General Clauses Act, 1897 defines a "Central Act" as an Act of Parliament and defines "Rule" as a rule made in exercise of power conferred by an enactment. A Rule is consequently subordinate legislation and does not become a Central Act merely because the power to frame it derives from a Central Act.....
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....ion created exclusively by the omitted rule. Earlier authority on fresh action after omission 1969 (7) TMI 109 - Supreme Court considered whether a prosecution could be initiated under a rule after that rule had been omitted. The saving there covered only matters already done or omitted to be done; it did not continue the rule so as to support fresh proceedings after omission. The decision confirms that a saving must clearly preserve the authority sought to be exercised. Its relevance to Rule 96(10) lies in the insistence that a general reference to past conduct cannot substitute for an express continuation of the omitted rule. 2002 (9) TMI 3 - Supreme Court applied the omission principle to a penal statutory provision. Following the earlier binding approach, it held that Section 6 does not extend to an omission and could not sustain prosecution under the omitted provision. Although it concerned a statutory penal provision rather than an export-refund rule, it reinforces the distinction between repeal and omission that underlies the Rule 96(10) result. Judicial treatment of Rule 96(10) before the controlling ruling 2025 (9) TMI 806 - Bombay High Court examined the om....
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....d that proceedings could not be initiated after omission of the rules and that, once the parent charging provision was omitted without a saving clause, unfinalised proceedings could not lawfully be completed. While the statutory context differs, the decision illustrates the need for an express saving if an omitted legal regime is to continue operating. 1995 (8) TMI 5 - Madhya Pradesh High Court quashed prosecution commenced after omission of penal provisions in the absence of a saving clause. Its relevance is confined to the general consequence of omission: action cannot be founded on a provision no longer in force unless the legislature has expressly preserved that authority. A distinguishable approach concerning machinery provisions 1992 (8) TMI 89 - Gujarat High Court Full Bench took a different approach in the context of substituted and omitted excise recovery rules. It reasoned that the charging liability under the parent statute remained in force, while the changes concerned the machinery for recovery; the substituted provisions substantially continued the earlier scheme. On that basis, it held that the recovery proceedings did not lapse merely by substitution or omi....