Notification No. 11/2025 – Central Tax

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)
CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

NOTIFICATION

No. 11/2025 – Central Tax
New Delhi, the 27th March, 2025.

G.S.R... (E).–In exercise of the powers conferred by section 164 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following rules further to amend the Central Goods and Services Tax Rules, 2017, namely:—

1. (1) These rules may be called the Central Goods and Services Tax (Second Amendment) Rules, 2025.
   (2) They shall come into force on the date of their publication in the Official Gazette.

2. In the Central Goods and Services Tax Rules, 2017,–

   (a) In Rule 164, –

   • (i) In sub-rule (4), after the words “after payment of the full amount of tax”, the words “related to period mentioned in the said sub-section and” shall be inserted.

   • (ii) After sub-rule (4), the following Explanation shall be inserted:

     “Explanation – No refund shall be available for any tax, interest, and penalty, which has already been discharged for the entire period, prior to the commencement of the Central Goods and Services Tax (Second Amendment) Rules, 2025, in cases where a notice or statement or order mentioned in sub-section (1) of section 128A, includes a demand of tax, partially for the period mentioned in the said sub-section and partially for a period other than mentioned in the said sub-section.”

   (b) In Rule 164, in sub-rule (7), after the first proviso, the following proviso shall be inserted:

   • “Provided further that where the notice or statement or order mentioned in sub-section(1) of section 128A of the Act includes demand of tax, partially for the period mentioned in the said sub-section and partially for the period other than that mentioned in the said sub-section, the applicant instead of withdrawing the appeal, shall intimate the appellate authority or Appellate Tribunal that he does not wish to pursue the appeal for the period mentioned in the said sub-section and the relevant authority shall, after taking note of the said request, pass such order for the period other than that mentioned in the said sub-section, as he thinks just and proper.

   • Explanation – For the removal of doubt, it is clarified that the appeal application shall be deemed to have been withdrawn to the extent of the said intimation for the period from the 1st July, 2017 to the 31st March, 2020 or part thereof, for the purpose of sub-clause (3) of section 128A.”

[No. CBIC-20016/12/2025-GST]

(Raushan Kumar)
Under Secretary to the Government of India

Analysis Report on Notification No. 11/2025 – Central Tax

1. Background and Prior Condition

A. Refund Provisions Before This Notification

• Previously, taxpayers could claim refunds on taxes, interest, and penalties even when a notice demanded tax for different periods together.

• There was no specific restriction on claiming refunds for amounts that had already been fully discharged before this amendment.

B. Appeal Withdrawal Process Before This Notification

• Earlier, if a taxpayer received a tax demand notice covering multiple periods and wished to contest only a part of it, they had to withdraw the entire appeal.

• This was inconvenient as businesses had to refile appeals for certain periods separately.

2. Impact of the Notification

A. Changes in Refund Rules (Rule 164 Amendment)

• Now, no refund will be granted for any tax, interest, or penalty that has already been fully paid for a given period if the tax demand notice includes multiple periods.

• Practical Example:

  • A business receives a tax demand for 2018-19 and 2023-24 together.

  • If the business has already paid the tax for 2018-19, it cannot claim a refund for that period, even if it is disputing the demand for 2023-24.

B. More Flexible Appeal Process (Rule 164(7) Amendment)

• Taxpayers can partially withdraw an appeal instead of withdrawing it entirely.

• Practical Example:

  • Suppose a company files an appeal against a GST demand notice covering 2017-2020 and 2022-2025.

  • Under the new rule, the company can withdraw the appeal only for the 2017-2020 period and continue contesting the 2022-2025 period without filing a fresh appeal.

  • This reduces legal and administrative burdens on businesses.

3. Conclusion

• This amendment clarifies refund rules and ensures that businesses cannot reclaim taxes they have already paid in case of mixed-period demands.

• The change in appeal rules provides greater flexibility, allowing businesses to contest tax demands more efficiently without unnecessary withdrawal of full appeals.

• These modifications aim to streamline GST compliance and legal processes for businesses.

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