Amendment in Rule 89(4) Introducing Comparison of Tax Invoice & Shipping Bill is Not Clarificatory in Nature | HC

Case Details: Tata Steel Ltd. v. Union of India - [2023] 154 taxmann.com 76 (Jharkhand)

Judiciary and Counsel Details

• • Rongon Mukhopadhyay & Deepak Roshan, JJ.
  • Tarun Gulati, Sr. Adv. Sumeet Gadodia & Salona Mittal, Advs. for the Appellant.
  • Anil Kumar, P.A.S. Pati & Mrs Ranjana Mukherjee, Advs. for the Respondent.

Facts of the Case

In this petition, the refund claim of petitioner was rejected on the ground that while processing refund claims in case of exports, lower of values indicated in tax invoice and shipping bill should be taken into account. It filed writ petition and contended that amendment brought in rule 89 (4) of CGST Rules, 2017 which introduced comparison between values indicated in tax invoice and shipping bill would have a prospective effect.

High Court Held

The Honorable High Court noted that the CBIC has inserted a new stipulation for comparison between two values being values indicated in tax invoice and shipping bill. A policy can be changed only by way of an amendment under parent Act and not by a circular and policy change will be effective from date of amendment.

Moreover, no retrospective date has been indicated in Notification No. 14/ 2022-Central Tax dated 5-7-2022 for bringing amendment under Rule 89 (4). Therefore, by way of amendment, a substantive change has been brought in law and it ought to operate prospectively since mere use of term explanation will not be indicative of fact that amendment is clarificatory/declaratory. Thus, the Court held that the period involved in the instant case was prior to amendment and the impugned order deserved to be quashed and set aside.

List of Cases Reviewed

• • Union of India v. Martin Lottery Agencies Ltd. [2009] 20 STT 203 (SC) (para 17)
  • Kunnathat Thatehunni Moopil Nair etc. v. State of Kerela 1960 SCC Online SC 7 (para 18) followed.

List of Cases Referred to

• • Mafatlal Industries Ltd. v. Union of India 1997 (89) E.L.T. 247 (SC) (para 10)
  • Union of India v. VKC Footsteps India (P.) Ltd. [2021] 130 taxmann.com 193/2021 (52) GSTL 513 (SC) (para 10)
  • Union of India v. Bharti Airtel Ltd. [2021] 131 taxmann.com 319/2021 (54) GSTL 257 (SC) (para 10)
  • Sree Sankaracharya University of Sanskrit v. Dr. Manu 2023 SCC Online SC 640 (para 13)
  • CIT v. Vatika Township (P.) Ltd. [2014] 49 taxmann.com 249/227 Taxman 121/367 ITR 466 (SC) (para 15)
  • Sedco Forex International Drill Inc. v. CIT [2005] 149 Taxman 352/279 ITR 310 (SC) (para 16)
  • Union of India v. Martin Lottery Agencies Ltd. [2009] 20 STT 203 (SC) (para 17)
  • Kunnathat Thatehunni Moopil Nair etc. v. State of Kerela 1960 SCC Online SC 7 (para 18).