Summary
The CBIC has issued Circular No. 264/10/2026-GST dated 26.10.2026 under Section 168(1) of the CGST Act. Following the Supreme Court’s judgment in Goodluck India Limited, the Board accepts that the omission of Rule 96(10) of the CGST Rules applies retrospectively from 23.10.2017. Field officers have been told to deal with pending proceedings accordingly. The same treatment applies to the omission of Rules 89(4A) and 89(4B).
What Was Rule 96(10)?
Rule 96 deals with refund of IGST paid on goods exported out of India. Rule 96(10), in force from 23.10.2017, stopped exporters from taking the IGST refund route if they had procured inputs under specified concessional or exemption notifications. The aim was to prevent a double benefit: tax-free inputs plus a refund of IGST paid on exports. In practice, many exporters were later asked to repay IGST refunds already received, with interest and penalty.
On the recommendation of the 54th GST Council meeting (09.09.2024), Rule 96(10) was omitted with effect from 08.10.2024 by Notification No. 20/2024-Central Tax. Rules 89(4A) and 89(4B), which carried related restrictions on refunds where inputs were received under such notifications, were omitted at the same time. The government’s position was that the omission was only for the future.
The Supreme Court Judgment
| Case | M/s Goodluck India Limited & Anr. v. Union of India & Ors., SLP (Civil) No. 24550 of 2025, with connected matters |
|---|---|
| Date | 06.08.2026 |
| Held | As the omission of Rule 96(10) came with no saving clause or sunset clause, it applies to all proceedings pending on the date of omission. |
| Reasoning | Relying on the Constitution Bench in Kolhapur Canesugar Works Ltd. v. Union of India [(2000) 2 SCC 536], Section 6 of the General Clauses Act, 1897 does not apply to the omission of a rule. Pending proceedings survive only if there is an express provision or legal device to keep them alive. There was none here. |
What the Circular Says
- The omission of Rule 96(10) is effective retrospectively from 23.10.2017.
- Field formations must deal with pending proceedings on Rule 96(10) in line with the Supreme Court judgment.
- The same applies, mutatis mutandis, to the omission of Rules 89(4A) and 89(4B).
What This Means for Exporters
| Your situation | Effect |
|---|---|
| Show cause notice under Rule 96(10) not yet decided | The proceeding is pending, so the Rule 96(10) ground falls. Cite the judgment and this circular in the reply. |
| Demand confirmed, but appeal pending (Appellate Authority, GSTAT or High Court) | The matter is still pending. Rely on the judgment and this circular in the appeal. |
| Refund claim pending or rejected only because of Rule 96(10), 89(4A) or 89(4B), with appeal or reconsideration pending | That ground no longer stands. Pursue the claim on this basis. |
| Order passed, not challenged, and appeal time over | The judgment speaks of pending proceedings. Whether a closed matter can be reopened depends on its facts. Take advice on the specific case. |
Checklist
- List all notices, orders, appeals and refund claims where Rule 96(10), 89(4A) or 89(4B) was a ground, with their present stage.
- In pending notices, file a reply or additional submission citing Goodluck India Limited (SC, 06.08.2026) and Circular 264/10/2026-GST.
- In pending appeals, file an additional ground or written submission on the same basis.
- Where amounts were paid under protest or as pre-deposit in such matters, track them for refund once the matter is decided.
- Check that the demand did not rest on any other ground as well. The circular removes only the Rule 96(10), 89(4A) and 89(4B) objection.
Related
- GST Export Refund: Removal of the 1.5 Times Domestic Value Restriction Proposed
- GSTAT Appeal Filing Deadline Extended
- GST Notice Reply Draft Generator
Reference: Circular No. 264/10/2026-GST dated 26.10.2026; Goodluck India Limited & Anr. v. Union of India & Ors., SLP (C) No. 24550 of 2025, SC, 06.08.2026; Notification No. 20/2024-Central Tax dated 08.10.2024; Rules 89(4A), 89(4B) and 96(10), CGST Rules, 2017. This page is for general information only.
Official CBIC circular
Circular No. 264/10/2026-GST