The Himachal Pradesh High Court set aside three show cause notices of July 2025, holding that no proceedings could be founded on a rule omitted without a saving clause.
The Himachal Pradesh High Court has quashed show cause notices (SCNs) issued on 25 Jul 2025 under Rule 96(10) of the CGST Rules, holding them non est because the rule had been omitted by notification dated 8 Oct 2024 without any saving clause, leaving the authority without statutory backing to issue them. [Greenlam Industries Limited v. Union of India & Ors., 2026-juristway.com-3291-HC(Himachal Pradesh)-GST]
Justice Ajay Mohan Goel and Justice Yogesh Jaswal decided the writ petition, with Justice Ajay Mohan Goel writing the order. The petitioners had also sought declarations on the validity and prospective application of Rule 96(10), but argued primarily that action under an omitted rule is bad in law. Counsel for the State and for respondent No. 5 could not dispute the facts.
The petitioners relied on Goodluck India Limited v. Union of India (SLP (C) No. 24550 of 2025), where the Supreme Court applied the Constitution Bench ruling in Kolhapur Canesugar Works Ltd v. Union of India (2000). Proceedings under an omitted rule can continue only where an express provision or legal device saves them, and the GST Council’s recommendation that the omission be prospective was advisory and did not bind the rule-making authority.
They also produced Circular No. 264/10/2026-GST dated 26 Oct 2026. In it, CBIC records the Supreme Court’s holding that the omission applies to all proceedings pending on the date of omission, clarifies that the omission of Rule 96(10) will be effective retrospectively from 23 Oct 2017, and advises field formations to deal with pending proceedings accordingly. The same treatment is to apply to the omission of Rules 89(4A) and 89(4B).
Having considered Goodluck India and the fact that the rule was omitted without a saving clause, the Court held that the notices were issued without any statutory backing. It allowed the writ petition, quashed all three SCNs with consequences to ensue, and made no order as to costs.
2026-juristway.com-3291-HC(Himachal Pradesh)-GST
