Section 16 of IGST Act provides for ‘Zero Rated Supply’ and sub-clause (b) of subsection (3) of Section 16 provides that, a registered person making zero rated supply shall be eligible to claim a refund if he has supplied the goods or services or both, subject to such conditions, safeguards and procedure as may be prescribed, on payment of integrated tax and claim a refund of such tax paid on goods or services or both supplied. Further, Section 164 of the CGST Act provides that the government may on the recommendation of the Council make rules for carrying out the provisions of the Act. The government can make rules for all or any of the matters which by this Act are required to be prescribed or in respect of which provisions are to be or may be made by rules. Thus, the sub-rule (10) of Rule 96 is intra-vires to the provisions of the CGST Act.
For more details, Please read the gist of the Recent Gujarat HC ruling from the attached document: Gist of Hon’ble Gujarat High Court Judgment in the case of Cosmo Films Limited v. Union of India (SCA 158332018)
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