P M Ganesh vs. The Deputy Commissioner
Held
The Court held that immovable property, including structures, cannot be construed as 'goods' or 'services' under the GST Act. It ruled that the acquisition of property by the State through eminent domain does not amount to a 'supply of goods or services' and therefore, GST is not applicable to the compensation paid. The deduction was deemed an arbitrary and colourable exercise of power.
Facts
The petitioner's land and structure were acquired for a National Highway project, and the Special Land Acquisition Officer deducted 18% GST (Rs. 2,20,623.25) from the compensation amount of Rs. 16,38,274.32. The petitioner challenged this deduction, contending that land acquisition does not fall under the purview of 'supply of goods or services' for GST levy.
Key Issues
Whether GST can be levied and deducted from compensation paid for the compulsory acquisition of land and structures by the State. Whether such an acquisition constitutes a 'supply of goods or services' under the GST framework.
Sections Cited
Central Goods and Service Tax Act, 2017, Article 366(12A) of the Constitution of India, Section 3 of the Transfer of Property Act, 1882
AI-generated summary — verify with the full judgment below
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HC-KAR
CNR: KAHC010554202026 NC: 2026:KHC:43490 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 14TH DAY OF AUGUST, 2026 BEFORE THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 25234 OF 2026 (LA-RES)
BETWEEN:
P.M. GANESH S/O LATE P.R. MUTHU AGED ABOUT 57 YEARS, BASAVANAHALLI VILLAGE KUSHAL NAGAR TALUK KODAGU DISTRICT-571234. …PETITIONER (BY SRI. NARENDRA GOWDA, ADVOCATE)
AND:
THE DEPUTY COMMISSIONER KODAGU DISTRICT, KODAGU.
THE SPECIAL LAND ACQUISITION OFFICER AND COMPETANT AUTHORITY, NATIONAL HIGHWAY 275 (MYSORE - MADIKERE DIVISION) NO.984, 1ST FLOOR, GEETHA ROAD CHAMARAJPURAM, MYSORE-570005. 3. NATIONAL HIGHWAY AUTHORITY OF INDIA MINISTRY OF ROAD TRANSPORT AND HIGHWAYS GOVERNMENT OF INDIA, REGIONAL OFFICE BESIDE NAGASANDRA METRO STATION BANGALORE-560073 REPRESENTED BY ITS DEPUTY GENERAL MANAGER. HEMALATHA J Location: HIGH COURT OF KARNATAKA HC-KAR
CNR: KAHC010554202026 NC: 2026:KHC:43490
PROJEC
The judgment continues below.
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