On 27th March 2025, the Ministry of Finance, Government of India, issued Notification No. 11/2025 – Central Tax under the authority of the Central Goods and Services Tax Act, 2017. This notification, published in the Gazette of India, marks the Second Amendment to the CGST Rules in 2025. These amendments are crucial in refining the interpretation and operational aspects of Rule 164 and are aimed at improving clarity in appeal processes and refund claims under the GST framework.
Key Highlights of the Amendment
The focus of the notification lies in introducing two key changes to Rule 164 of the CGST Rules, 2017:
- Clarification on Refunds [Rule 164(4)]
A new explanation has been inserted after Rule 164(4), explicitly stating:
No refund shall be available for any tax, interest, or penalty already discharged prior to the commencement of the Second Amendment Rules, 2025, even if the notice or order relates partially to the eligible period and partially to a non-eligible period.
This means that if a taxpayer has already paid dues for a period before the new rules came into effect, no retrospective refund will be allowed — even if the demand notice covered both eligible and ineligible periods. This amendment aims to avoid dual interpretations and unintended refund claims in such mixed-period cases.
- Flexibility in Appeals [Rule 164(7)]
A second proviso has been added to Rule 164(7). It provides an option for taxpayers who have received a demand notice (as per Section 128A(1) of the CGST Act) for both eligible and ineligible periods:
Instead of withdrawing the entire appeal, the taxpayer can now intimate the authority that they do not wish to pursue the appeal only for the eligible period.
The Appellate Authority or Tribunal will take note of this intimation and proceed to pass an order for the non-eligible period as appropriate. The appeal will be considered withdrawn by default only for the eligible period (1st July 2017 to 31st March 2020).
This is a taxpayer-friendly measure that allows partial continuation of appeals and avoids forcing complete withdrawal due to period overlaps in demand orders.
Why This Amendment Matters
Administrative Efficiency: By clearly bifurcating treatment for mixed-period appeals, authorities can now handle cases more consistently and avoid legal ambiguities.
Legal Clarity: The inserted explanations eliminate confusion about eligibility for refunds and appeals, especially in cases involving complex timelines.
Ease of Doing Business: Taxpayers gain the flexibility to pursue appeals for specific periods, potentially reducing litigation burdens and enhancing trust in the GST mechanism.
