The Supreme Court has listed the issues of Validity of Refund of Inverted Duty on Input Services on April 28, 2021 for final hearing. The batch of petitions arose from the judgments of the High Court of Gujarat and of the High Court of Madras. The Gujarat High Court has held that Explanation (a) to Rule 89(5) of the CGST Rules 2017 is ultra vires, while a contrary view has been taken by the High Court of Madras. Since a large number of petitions are pending in the High Courts on the same issue, the Apex court found it appropriate to list the batch of cases at 28 April 2021 for final hearing. Following issues have been raised:Firstly, whether the amended Rule 8 of the CGST Rules is ultra vires Section 54(3) in as much as Section 54(3) provides for refund of ‘any unutilized input tax credit accumulated on account of inverted duty structure thereby covering credit of both ‘inputs’ and ‘input services.Secondly, whether the amended Rule 89 of the CGST Rules is violative of Article 14 of Constitution of India inasmuch as it treats dealers with accumulated credit on inputs and dealers with accumulated credit on input services differently. Thirdly, whether Section 164(3) is unconstitutional inasmuch as it suffers from the vice of excessive delegation. Fourthly, whether the amendment of Rule 89 cannot be given retrospective application.The above issues have arisen due to the contrary decisions of the Gujarat HC and Madras HC in this regard. The Gujarat HC in the case of VKC Footsteps India Pvt. Ltd. vs. Union of Indiaheld that:“By prescribing the formula in Sub-rule 5 of Rule 89 of the CGST Rules, 2017to exclude refund of tax paid on ‘input service’ as part of the refund of unutilised input tax credit is contrary to the provisions of Sub-section 3 of Section 54 of the CGST Act, 2017 which provides for claim of refund of ‘any unutilised input tax credit’. and therefore, directed the authority to allow the claim of the refund made by the petitioners considering the unutilised input tax credit of “input services” as part of the “net input tax credit’.Whereas the Madras HC in the case of Tvl. Transtonnelstroy afcons joint venture vs. Union of India held that “section  54(3)(ii) does not infringe Article 14 and thus refund of only inputs is available under inverted duty structure (IDV) (section 54(3)(ii). The court observed that Rule 89(5) is not ultra vires to section 54(3) (ii). As a corollary, Rule 89(5) of the CGST Rules, as amended, is in conformity with Section 54(3)(ii).”