What happened
The Central Board of Indirect Taxes and Customs (CBIC) has issued Circular No. 264/10/2026-GST, dated 26 October 2026 (F. No. CBIC-20001/2/2026-GST, GST Policy Wing, Room No. 16039, Kartavya Bhawan-01, New Delhi, signed by Gaurav Singh, Commissioner (GST)). Its subject: “Clarification in respect of the omission of rule 96 (10) of the Central Goods and Services Tax Rules, 2017”. The circular settles a question that has hung over export-refund litigation since last year: does the omission of Rule 96(10) of the CGST Rules help only cases arising after the omission, or also cases that were already pending when the rule was deleted?
CBIC's answer is clear. Acting under sub-section (1) of Section 168 of the CGST Act, 2017, the Board clarifies that the omission applies retrospectively from 23 October 2017 — the date from which Rule 96(10) itself operated — and not merely prospectively from 8 October 2024, the date Notification No. 20/2024-Central Tax gave effect to the omission. Field formations must therefore deal with pending Rule 96(10) proceedings in line with the Supreme Court's judgment of 6 August 2026 in M/s Goodluck India Limited & Anr. v. Union of India & Ors. (SLP(C) 24550/2025, along with other connected matters).
Why Rule 96(10) mattered
Rule 96(10), in force from 23 October 2017, barred the refund of IGST paid on exports where specified IGST exemptions or concessions had been availed on inputs. The idea was to prevent a double benefit: exporters who benefited from IGST exemption on procurement under specified notifications could not also claim IGST refunds on export of those goods. In practice, exporters who had taken an exemption at the input stage found their export refunds denied or held up under the rule.
On the recommendation of the 54th GST Council (9 September 2024), the rule was omitted with effect from 8 October 2024 by the CGST (Second Amendment) Rules, 2024 (notified vide Notification No. 20/2024-Central Tax). But the notification did not say, in terms, what would happen to proceedings that were already pending on that date. Refund claims and appeals stuck in the pipeline were left in limbo: was the bar still alive for them, or had the omission wiped it out?
What the Supreme Court held in Goodluck India
The Supreme Court answered that question on 6 August 2026 in M/s Goodluck India Limited & Anr. v. Union of India & Ors., along with other connected matters. As recorded in the circular, the Court held that the omission of Rule 96(10) carried no saving clause and no sunset clause, and therefore applies to all proceedings pending as on the date of omission. The Court relied on the Constitution Bench judgment in Kolhapur Canesugar Works Ltd. v. Union of India ((2000) 2 SCC 536), holding that Section 6 of the General Clauses Act, 1897 does not apply to the omission of a rule — where a rule is omitted, pending proceedings can continue only where there is an express provision for their continuance, or a legal device has been incorporated in the statute or rules to preserve them.
What Circular 264 directs
The circular gives field formations a single operative direction: deal with pending proceedings concerning Rule 96(10) in accordance with the Goodluck India judgment. The same treatment applies, mutatis mutandis, in respect of the omission of Rules 89(4A) and 89(4B) as well. The circular also asks that suitable trade notices be issued to publicise its contents, and invites difficulties in implementation to be brought to the Board's notice.
Three points in the circular deserve emphasis:
- Retrospective, not prospective only. The omission is effective from 23 October 2017 for this purpose — the whole life of Rule 96(10) — rather than only from 8 October 2024.
- Pending proceedings are the subject matter. The circular is aimed at cases still pending, not at reopening matters already finally decided. (Whether a particular concluded case can be revisited is NOT CHECKED in the circular and is not answered here.)
- No new procedure is prescribed. The circular lays down no new refund form, no new procedure and no new deadline. Its operative content is the direction to decide pending cases per the judgment.
Old position vs new position
Who is affected
The circular matters most to exporters with IGST refund claims or appeals pending where the department invoked Rule 96(10) — typically cases where an input-stage IGST exemption or concession had been availed. It also matters to tax professionals and departmental officers handling such files, who now have a uniform CBIC direction instead of case-by-case litigation on the retrospectivity point. Businesses with no pending Rule 96(10) proceeding are not directly affected: the circular creates no new refund window and prescribes no fresh application route.
What to do next
- If you have a pending Rule 96(10) case: cite Circular 264/10/2026-GST and the Goodluck India judgment (6 Aug 2026) before the deciding authority, and ask that the proceeding be decided on that basis rather than by applying the omitted rule.
- Check the companion rules: if your case concerns the omission of Rule 89(4A) or 89(4B), the circular extends the same treatment mutatis mutandis — flag this expressly, since those rules are covered only by that extension.
- Do not assume an automatic refund: the circular removes the Rule 96(10) bar for pending proceedings; it does not by itself grant a refund. Other refund conditions and verification (NOT CHECKED in this circular) still apply to each claim.
- Keep the paper trail: preserve the circular, the Goodluck India judgment, and proof that the proceeding was pending, since the benefit turns on pendency.
What this circular does NOT do
It does not reopen finally decided cases (NOT CHECKED — the circular addresses pending proceedings); it does not create a new refund form, procedure or deadline; and it does not change any other refund condition. Readers should not read it as a general amnesty for all past refund denials.
FAQs
Q: Is the omission of Rule 96(10) retrospective?
A: Yes. Circular 264/10/2026-GST confirms the omission applies retrospectively from 23 October 2017, following the Supreme Court's Goodluck India judgment — not only prospectively from 8 October 2024.
Q: What happens to my pending Rule 96(10) case?
A: Field formations have been directed to deal with pending Rule 96(10) proceedings in accordance with the Goodluck India judgment, i.e. without applying the omitted rule where the omission carries no saving clause.
Q: Does the circular cover Rules 89(4A) and 89(4B) too?
A: Yes — the same treatment applies mutatis mutandis in respect of the omission of those rules as well.
Q: Is there a new form or deadline to claim?
A: No. The circular prescribes no new refund form, procedure or deadline; it is a direction for pending proceedings.
Q: Why doesn't Section 6 of the General Clauses Act save the old rule?
A: Because, as the Supreme Court held in Goodluck India (following Kolhapur Canesugar), Section 6 does not apply to an omission of a rule, and the omission here had no saving or sunset clause.
Sources
- CBIC Circular No. 264/10/2026-GST dated 26.10.2026 (official CBIC Tax Information Portal PDF), issued under Section 168(1) of the CGST Act, 2017: https://taxinformation.cbic.gov.in/view-pdf/1003355/ENG/Circulars
- Notification No. 20/2024-Central Tax / CGST (Second Amendment) Rules, 2024 (omission of Rule 96(10) w.e.f. 8 Oct 2024) — as cited in the circular.
- Supreme Court judgment dated 6 Aug 2026 in SLP(C) 24550/2025, M/s Goodluck India Limited & Anr. v. Union of India & Ors. (along with other connected matters) — as cited in the circular.
- Kolhapur Canesugar Works Ltd v Union of India, (2000) 2 SCC 536 — as cited in the circular.
