The Supreme Court has conclusively resolved the most contested procedural question to have emerged from the October 2024 omission of Rule 96(10) of the CGST Rules: the omission, having been effected without any saving clause, applies to all proceedings pending on the date it came into force — not merely to proceedings initiated after that date. The judgment, by a bench of Justice J.B. Pardiwala and Justice K. Vinod Chandran in M/s Goodluck India Limited & Others v. Union of India (Civil Appeal Nos. 10261–10435 of 2026, decided 06.08.2026), dismissed the Revenue's appeals from a batch of High Court orders across the country that had reached the same conclusion.

Rule 96(10) had created a significant restriction: exporters who had availed certain exemption-based input supply notifications were barred from claiming a refund of Integrated Tax paid on exports of goods. This restriction created what the Law Committee of the 54th GST Council (September 2024) described as "unnecessary complications without any intended benefit being served." The Government accordingly omitted Rule 96(10) through Notification No. 20/2024-Central Tax with effect from 08.10.2024. Crucially, the notification did not contain a saving clause to preserve the enforceability of the restriction in pending proceedings. Multiple High Courts, on applications by exporters whose refund claims had been blocked under the rule, held that the omission wiped out the restriction for all pending proceedings. The Revenue challenged these rulings in the Supreme Court.

The Revenue's principal argument rested on the 54th GST Council's recommendation that the omission operate "prospectively." The Additional Solicitor General fairly conceded that this recommendation was advisory in character — the Council's recommendations do not bind the rule-making authority, and the Government is not obligated to implement them in the precise manner suggested. This concession effectively surrendered the Revenue's strongest factual argument. The Court then turned to first principles, applying the Constitution Bench ruling in Kolhapur Canesugar Works Ltd. v. Union of India (2000) 2 SCC 536. The rule in Kolhapur Canesugar Works is that omission of a statutory provision without a saving clause obliterates it completely, as if it had never been on the statute book. Section 6 of the General Clauses Act — which preserves rights accrued under a repealed enactment — applies only to the repeal of Central Acts or regulations, not to the omission of rules. Without either a saving clause or a statutory fiction treating the omitted rule as still in force for pending proceedings, there is simply no legal basis to continue enforcing the restriction.

The Court drew additional support from the evident purpose of the omission. The Law Committee's own characterisation of Rule 96(10) as causing "unnecessary complications" without serving any intended benefit is an acknowledgment that the restriction was counterproductive. If the intent was to eliminate these complications only from the date of omission forward while preserving them for all existing cases, the Rule-making authority would have said so through a saving clause. The absence of such a clause is itself evidence that the intent was to end the complications across the board. The SLPs filed by certain exporters challenging the constitutional validity of Rule 96(10) were dismissed as infructuous, since the rule had already been deleted. The Registry was directed to circulate the judgment to all High Courts to enable expeditious closure of the many pending cases on this issue.

- 2026-juristway.com-2153-SC-GST  |  Supreme Court of India  |  06.08.2026