HC Remands IGST Refund Case Involving Omitted Rule 96(10)

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Rule 96(10) IGST refund dispute

Case Details: Kelvion India (P.) Ltd. vs. Union of India - [2025] 181 taxmann.com 723 (Bombay)

Judiciary and Counsel Details

  • M.S. Sonak & Advait M. Sethna, JJ.
  • Rahul Thakar, C. B. Thakar & Yash Dethe, Advs. for the Petitioner.
  • Karan Adik & Megha Bajoria, Advs. for the Respondent.

Facts of the Case

The petitioner, a manufacturer-exporter, imported raw materials under advance authorisation with exemption from customs duty and IGST and exported finished goods on payment of IGST during June 2019 to December 2019 and July 2020 to September 2020, claiming IGST refunds. The Directorate of Revenue Intelligence (DRI) alleged violation of Rule 96(10) of the CGST Rules due to use of advance authorisation, pursuant to which the petitioner repaid the refunded IGST along with interest. Claiming that excess tax had been paid, the petitioner filed a refund application, which was rejected by the adjudicating authority and the rejection was upheld in appeal, leading to the writ petition.

High Court Held

The High Court held that Rule 96(10) of the CGST Rules had been omitted without any saving clause, as already held in Hikal Ltd. v. Union of India. Since the authorities had proceeded on the basis of an omitted provision and without the benefit of the said decision, the impugned orders could not be sustained. Without examining the merits, the Court set aside the impugned orders and remanded the matter to the adjudicating authority to decide the refund application afresh after considering the legal position, thereby deciding the matter in favour of the assessee by way of remand.

List of Cases Reviewed

List of Cases Referred to

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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