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2025 Supreme(Guj) 1681
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
Bhargav D. Karia, D.N.Ray, JJ.
Messrs Addwrap Packaging Pvt. Ltd. & Anr. – Petitioners
Versus
Union Of India & Ors. – Respondents
R/Special Civil Application No. 22519 of 2019
Decided On : 27-06-2025
For the Petitioner:Amal Paresh Dave, Dr.Avinash Poddar and Mr. Hardik Vora, Learned Senior Advocate Mr. V.Sridharan with learned advocates Mr. Anand Nainawati with Mr.Sahil Parghi with Mr. Ashish K.Vadodaria with Mr. Uchit Sheth with Mr. Paresh Dave with Mr. Amal Dave with Mr. Dhaval Shah with Mr. Parth Rachh with Mr. Aditya Tripathi with Mr. Abhishek Rastogi with Mr. Jatin Arora with Mr. Bharat Raichandani with Mr. Rashi Chopra with Mr. Love Sharma with Mr. Anshul Jain with Mr. Rithik Jain with Mr. Hiren J. Trivedi
For the Respondent:Mr Paresh M Dave, Mr Devang Vyas, Mr Siddharth H Dave, Learned ASG Mr. Devang Vyas with learned advocates Mr. Siddharth Dave with Mr. Utkarsh Sharma with Mr. C.B.Gupta with Mr. Chirayu Mehta with Mr. Parth Divyeshwar with Ms.Hetvi Sancheti with Mr.Deepak Khemchandani with Mr. Param Shah
Important Points
Subject
Taxation - Goods and Services Tax
Act Referred
CENTRAL GOODS AND SERVICES TAX RULES: R.89(4), R.89(4)(a), R.89(4)(b), R.96, R.96(10), S.96(10)(b)
CENTRAL EXCISE RULES: R.18
INTEGRATED GOODS AND SERVICES TAX ACT: S.16, S.2, S.20, S.22
GOODS AND SERVICES TAX ACT: S.164, S.50, S.54, S.54(3)
CONSTITUTION OF INDIA: Art.136, Art.14, Art.19(1)(g), Art.279(a), S.265, S.279, S.301, S.302, S.303
CENTRAL GOODS AND SERVICES TAX CT: S.17, S.54, S.54(1)
CENTRAL GOODS AND SERVICES TAX ACT: S.2
VALUE ADDED TAX ACT: S.19
TAMIL NADU VALUE ADDED TAX ACT: S.19
GENERAL CLAUSES ACT: S.24, S.6, S.6(a)
DEFENCE OF INDIA RULES: R.132(a)
CENTRAL EXCISE ACT: S.38(a)
CUSTOMS ACT: S.159(a)
Headnote
JUDGMENT :
BHARGAV D. KARIA, J.
1. Draft amendment is allowed as per order dated 25.01.2023 passed in Special Civil Application No.238 of 2023.
2. This group of petitions are preferred challenging the vires of Rule 96(10) of the Central/ STATE GOODS AND SERVICES TAX RULES , 2017 (For short “the CGST Rules”) as substituted by the Central Goods and Services Tax(12th Amendment) Rules, 2018 with effect from 9.10.2018. Prior to its substitution, Sub-rule(10) was substituted by Central Goods and Services Tax 11th Amendment Rules, 2018 with retrospective effect from 23.10.2017 and Central Goods and Services Tax 8th Amendment Rules, 2018 with retrospective effect from 23.10.2017.
3. As the issue arising in this group of petitions is common, the same were heard analogously.
4. Brief facts of the case giving rise this group of petitions can be summarized by stating the facts of Special Civil Application No. 2187 of 2023 emerging from the record as under:
5. The petitioner of Special Civil Application No.2187 of 2023 is engaged in the business of manufacture, supply/export of conductors and Optical Fiber Ground Wires(OPGW) for several years and exports substantial quantity of finished goods manufactured to its customers spread across the world.
6. Prior to coming into the force of the Central GOODS AND SERVICES TAX ACT ,2017 (For short “the GST Act”) with effect from 01.07.2017, the inputs and the capital goods used by the petitioner were chargeable to Central Excise duty under the CENTRAL EXCISE ACT , 1944 and the input services used by the petitiones was chargeable to service tax under the Finance Act, 1994. The petitioner was eligible for availing the credit of the taxes paid by them on inputs, capital goods and input services under the Cenvat Credit Rules, 2004.
7. Cenvat Credit availed by the petitioner was in turn utilized for payment of the excise duty on the goods cleared by the petitioner in the domestic market as well as for payment of duties applicable at the time of export of goods.
8. The petitioner was entitled to claim rebate i.e. refund of actual amount of excise duty so paid on the goods exported under Rule 18 of the CENTRAL EXCISE RULES , 2002.
9. The petitioner applied for Advance Authorisation (AA) License in the year 2017 under Chapter 4 of the Export-Import policy framed by the Central Government under the provisions of the Foreign Trade (Development and Regulations) Act, 1992 which was allowed by the Director General of Foreign Trade (DGFT). The petitioner thereafter obtained several AA licenses during the period between 04.07.2017 to 10.04.2019 and imported some of the raw materials required in manufacture of finished products utilizing such AA licenses without payment of custom duty while procuring the other inputs, capital goods and input services from the domestic market by the petitioner.
10. As per the terms of the Advance Authorisation Scheme, the petitioner was not liable to pay any customs duty on raw materials imported on utilizing such licenses and therefore, no Cenvat credit of any customs duty in the nature of CVD, Education and other Cesses, Special Additional Duty (SAD) was availed by the petitioner. The petitioner however, availed Cenvat credit of excise duty and service tax paid on other inputs, capital goods and input services procured from the domestic market and utilized the same for payment of duty on exported goods and rebate of such duties paid was also allowed to the petitioner prior to coming into force of GST regime with effect from1.07.2017.
11. With effect from 01.07.2017, GST Act has been implemented by making necessary amendment in CUSTOMS ACT , 1962 and Customs Tariff Act, 1975 as well.
12. With effect from 01.07.2017 instead of levying and collecting additional duty of customs equal to the duty of excise chargeable on similar goods produced or manufactured in India, Integrated Goods and Services Tax (IGST) came to be levied on imported goods, whereas the goods cleared for export were deemed to
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