Amended Rule 89(4) Not Retrospective | Circular Legality to Be Reviewed – SC

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Amended Rule 89(4) Retrospective

Case Details: Union of India vs. Tata Steel Ltd. - [2025] 175 taxmann.com 756 (SC)

Judiciary and Counsel Details

  • Abhay S. Oka & Ujjal Bhuyan, JJ.
  • N. Venkataraman, A.S.G., Gurmeet Singh Makker, AOR, V.C. Bharathi, Sarthak Karol, Udai Khanna & Anuj Udupa, Advs. for the Petitioner.
  • Tarun Gulati, Sr. Adv., Abhishek Anand, Darpan Bhuyan, Rahul Kumar, Salona Mittal, Advs. & M.P. Devanath, AOR for the Respondent.

Facts of the Case

The petitioner challenged Paragraph 47 of Circular No. 125/44/2019-GST, dated 18-11-2019, which mandated that, for processing export refund claims, the lower of the values indicated in the tax invoice or the shipping bill should be considered. The petitioner contended that this provision was ultra vires the CGST Act and the CGST Rules as well as arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution of India. In addition, the petitioner contested the amendment to Rule 89(4) by Notification No. 14/2022, which introduced a similar stipulation for comparison between the invoice value and the shipping bill value. The petitioner argued that this amendment should not apply retrospectively. The High Court ruled that the amendment to Rule 89(4) was substantive, not clarificatory, and thus could not be applied retrospectively. The matter was placed before the Supreme Court for final determination.

Supreme Court Held

The Supreme Court upheld the High Court’s finding that the amendment to Rule 89(4) could not be applied retrospectively, as it was a substantive change in law. However, the Supreme Court remanded the matter to the High Court for a limited purpose: to review the legality of Circular No. 125/44/2019-GST, dated 18-11-2019. The Supreme Court did not interfere with the High Court’s conclusion regarding the retrospective operation of the amendment, but directed that the legality of the Circular be reconsidered.

List of Cases Reviewed

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied