The Himachal Pradesh High Court quashed a Show Cause Notice issued under Rule 96(10) of the CGST Rules, which had been omitted, holding that proceedings based on a non-existent rule are nullity in law.
HP HC Quashes GST SCN Issued Under Omitted Rule
The Himachal Pradesh High Court has quashed a Show Cause Notice (SCN) issued under Rule 96(10) of the Central Goods and Services Tax Rules, 2017, after the rule had been omitted with effect from a prior date. The court held that no valid jurisdiction exists to proceed under a rule that has ceased to exist, rendering the SCN a nullity in law.
Counsel for the petitioner established that Rule 96(10) was omitted by virtue of Notification No. 17/2022-Central Tax, effective 31 August 2022. Yet, the SCN was issued well after this date, citing the defunct provision. The department could not justify reliance on a provision with no legal force.
No authority can exercise powers under a rule or statutory provision that has been legally erased. A proceeding grounded on a non-existent rule is void ab initio.
This ruling reinforces the principle that statutory timelines and legislative amendments must be strictly observed by tax authorities. Practitioners should scrutinize the validity of rules cited in SCNs, especially where subsequent notifications may have rendered them inoperative.
Citations
- Rule 96(10) CGST Rules, omitted by Notification 17/2022-Central Tax
