Facts of the Case

Vaibhav Global Limited, having its registered office at Sitapura, Jaipur, filed this writ petition on 20.03.2021 before the Rajasthan High Court, Jaipur Bench, questioning the validity of Rule 96(10) of the CGST Rules, 2017 as being ultra vires Section 16(3)(b) of the IGST Act, and challenging summons and proceedings initiated against it. During the pendency of the writ petition, a show-cause notice dated 22.03.2022 was issued to the petitioner and placed on record by way of an application; the petitioner also sought amendment of the writ petition on 31.10.2023 to specifically challenge that show-cause notice. By then, however, a final assessment order dated 30.10.2023 had already been passed, which was separately challenged in a fresh writ petition, DBCWP No.19944/2023. The petitioner's stay application in the present matter had earlier been rejected on 07.08.2023. The matter was decided on 21.12.2023.

Issues Involved

  1. Whether the writ petition challenging the vires of Rule 96(10) of the CGST Rules had become infructuous once the underlying show-cause notice merged into a final assessment order under challenge in a separate petition.
  2. Whether the question of the legal validity of Rule 96(10) could nonetheless survive independently and be kept open despite the petition being otherwise infructuous.

Petitioner's Arguments

  • The core challenge in the petition was to the validity of Rule 96(10) of the CGST Rules as being ultra vires Section 16(3)(b) of the IGST Act, an issue not yet decided by the Court.
  • The mere passing of a final assessment order during the pendency of the writ petition did not mean the vires question stood resolved or that the petition had become academic.

Respondent's Arguments

  • The writ petition had been rendered infructuous because the show-cause notice under challenge had culminated in a final assessment order dated 30.10.2023, itself separately challenged in DBCWP No.19944/2023.

Court Order/Findings

  • The Court noted that the petitioner had originally challenged only the summons/show-cause notice, which by 30.10.2023 had merged into the final assessment order; the application seeking to specifically challenge the show-cause notice by amendment was itself moved only after the assessment order had already been passed.
  • Since no consequential relief remained available on the reliefs originally sought, the challenge in the present petition was rendered academic, though the larger question of the validity of Rule 96(10) of the CGST Rules was expressly kept open for adjudication in an appropriate proceeding.
  • The writ petition was dismissed as having become infructuous, without prejudice to the vires question.

Important Clarification

  • Where a show-cause notice under challenge merges into a subsequent final order, a writ petition confined to that notice typically becomes infructuous, and the challenge must instead be pursued against the final order.
  • Courts may keep open larger questions of legal validity even while dismissing a particular petition as infructuous, allowing the issue to be litigated in an appropriate, live proceeding.

Sections Involved

  • Rule 96(10), CGST Rules, 2017 – restricts refund of IGST paid on export of goods where inputs were procured availing certain concessional-duty benefits.
  • Section 16(3)(b), IGST Act, 2017 – governs the manner of claiming zero-rated supply/refund benefits for exporters, against which Rule 96(10) was alleged to be ultra vires.

Decision – In Favour of

Dismissed as infructuous — a procedural closure rather than a merits win for either side. The Assessee's specific reliefs in this petition could not survive once the final assessment order was passed and separately challenged, but the Court expressly kept the question of the validity of Rule 96(10) of the CGST Rules open for adjudication in an appropriate proceeding.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Judicature for Rajasthan, Bench at Jaipur
  • Case No.: D.B. Civil Writ Petition No. 4465/2021
  • CNR: Not available on record
  • Coram: Hon'ble Mr. Justice Arun Bhansali and Hon'ble Mr. Justice Narendra Singh Dhaddha
  • Decision Date: 21.12.2023
  • Disposal Nature: Writ petition dismissed as infructuous, question of vires kept open

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