Ganesh Majhi vs. The Executive Engineer,Kalahandi

Held

The Court disposed of the writ petition by directing the petitioner to make a comprehensive representation before the appropriate authority within four weeks, detailing their grievance. The authority is to consider and dispose of this representation expeditiously, preferably by February 29, 2020, in light of the revised guidelines dated December 10, 2018, issued by the Finance Department, Government of Odisha. The Court noted that if the petitioner is aggrieved by the authority's decision, they are free to challenge it. No coercive action is to be taken against the petitioner until February 29, 2020. The Court did not make a direct finding on the entitlement to reimbursement but provided a procedural path for resolution based on the existing guidelines.

Facts

The petitioner, a contractor, challenged the State's action of not reimbursing the differential tax amount arising from the transition from Value Added Tax (VAT) to Goods and Services Tax (GST) effective July 1, 2017. The petitioner's grievance was that they were required to pay GST on works contracts entered into before the GST regime, which was not anticipated when the agreements were made. The State submitted revised guidelines issued by the Finance Department, Government of Odisha, on December 10, 2018, which superseded earlier guidelines from December 7, 2017. These revised guidelines provided a procedure for determining the GST-inclusive work value for balance work executed after July 1, 2017, on tenders invited before that date.

Key Issues

1. Whether the petitioner is entitled to reimbursement of the differential tax amount arising from the change in tax regime from VAT to GST for works contracts entered into prior to July 1, 2017, but executed partly or wholly thereafter? Petitioner's contention: The petitioner argued that they are required to pay GST on works contracts that were agreed upon before the GST regime, leading to an unforeseen tax liability. Revenue's contention: The State argued that revised guidelines have been issued by the Finance Department (OM No. FIN-CTI-TAX-0045-2017/38535/F dated 10.12.2018) to address such situations. These guidelines provide a mechanism for determining the GST-inclusive work value for balance work and allow for reimbursement if the revised value exceeds the original agreement value.