Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR & THE HONOURABLE MR.JUSTICE MOHAMMED NIAS C.P.
TUESDAY, THE 28TH DAY OF MARCH 2023 / 7TH CHAITHRA, 1945 WA NO. 1745 OF 2022 AGAINST THE JUDGMENT DATED 01.09.2022 IN WP(C) 28592/2019 OF HIGH COURT OF KERALA APPELLANT/PETITIONER IN THE WRIT PETITION:
SRI. KUBERA CONSTRUCTIONS PRIVATE LTD AGED 58 YEARS BALAJI CELEBRATION B-WING, NEAR GANAPATI MANDIR, VISHRAMBAG, SANGLI- 416 415, MAHARASHTRA, REPRESENTED BY ITS DIRECTOR, MOTILAL PAREK, AGED 58 YEARS, S/O.
SRINARAYAN, FLAT NO. 1, ARCHANA APARTMENT, NEAR GANAPATI MANDI, VISRAMBAG, SANGLI - 416 415, MAHARASHTRA., PIN – 416415 BY ADVS.
SRI.PAUL K.VARGHESE SRI.A.A.GEETHA RESPONDENTS/RESPONDENTS IN THE WRIT PETITION:
1 STATE OF KERALA REPRESENTED BY CHIEF SECRETARY, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 001., PIN – 695001 2 SECRETARY TO GOVERNMENT OF KERALA, INFORMATION TECHNOLOGY DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 001, PIN – 695001 3 PRINCIPAL SECRETARY GOVERNMENT OF KERALA FINANCE DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 001, PIN – 695001 4 PRINCIPAL SECRETARY TO GOVERNMENT OF KERALA KERALA STATE GOODS AND SERVICES TAX DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695 001.,
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W.A.No.1745 of 2022 PIN – 695001 5 KERALA STATE IT INFRASTRUCTURE LTD TC 14/196/2, CHANDRASEKHARAN NAIR STADIUM, THIRUVANANTHAPURAM-695 033 REPRESENTED BY ITS MANAGING DIRECTOR, TC 14/196/2, CHANDRASEKHARAN NAIR STADIUM, THIRUVANANTHAPURAM-695 033, PIN – 695033 6 MANAGING DIRECTOR KERALA STATE IT INFRASTRUCTURE LTD, TCF 14/196/2, CHANDRASEKHARAN NAIR STADIUM, THIRUVANANTHAPURAM, PIN – 695033 BY ADVS.
SRI.K.A.ABDUL SALAM, SC, KERALA STATE IT INFRASTRUCTURE LTD. KSITIL SRI.SUNIL V.MOHAMMED(K/001561/2000) BY GOVERNMENT PLEADER SMT.M M JASMINE THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 28.03.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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W.A.No.1745 of 2022 JUDGMENT A.K.Jayasankaran Nambiar, J.
The Writ Appeal is preferred by the petitioner in WP(C) No.28592 of 2019 aggrieved by the judgment dated 01.09.2022 of the learned Single Judge.
2. The brief facts necessary for disposal of the Writ Appeal are as follows:
The appellant writ petitioner was awarded a contract to construct a building in Techno City, Thiruvananthapuram by the 5th respondent.
The contract was awarded on 07.09.2017, by which time the Goods and Service Tax (GST) regime had already come into force in the country with effect from 01.7.2017. The grievance of the appellant in the Writ Petition was essentially that as per the terms of the contract, he was entitled to payment of the GST over and above the amounts for which the work was awarded. When the said contention of the petitioner did not meet with any approval from the 5th respondent, he approached this Court through the Writ Petition.
3. The learned Single Judge, who went into the matter found that although the notice inviting tender that was issued in the Pre-GST
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W.A.No.1745 of 2022 period mentioned that the service tax would be paid extra by the 5th respondent. While it was a fact that in a Pre-Bid Meeting which was also held before the introduction of GST there was a clarification given to a query raised by one of the contractors that the service tax portion of works done in GST will be paid extra, the learned Single Judge found that the appellant did not even take part in the Pre-Bid Meeting and in a works contract that was performed during the Pre-GST regime the service tax had to be discharged under the provisions of the Finance Act, 1994 as amended and the tax component under the Kerala Value Added Tax Act. Following the introduction of GST, the tax on both supply of services and supply of goods was subsumed into one tax, and hence, after the introduction of GST from 01.7.2017, there was no scope for demand or payment of service tax as a component outside the GST regime. The learned Single Judge, therefore, found that there was no merit in the contention of the writ petitioner for reimbursement of the service tax component of GST as envisaged under the agreement between the parties.
4. Before us, it is the submission of Sri.Paul K. Varghese, the learned counsel for the appellant that the learned Single Judge ought not to have dismissed the Writ Petition more so when there is a chance for negotiation with the respondents for the reimbursement of the
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W.A.No.1745 of 2022 service tax component as envisaged under the agreement between the parties. On a consideration of the said contention, we are of the view that the negotiation in respect of the said aspect cannot bear any fruit in the light of the subsequent change in law that has come about.
Admittedly, the award of the contract was after the introduction of the GST and the tax, if any paid in respect of the work awarded could only have been under the new regime. Clauses in a contract which may have been applicable in the context of the earlier regime cannot have any application to determine the rights of the parties after the introduction of the GST. The prayer sought for in the Writ Petition being against the settled proposition in law, we do not see any reason to interfere with the judgment of the learned Single Judge that dismissed the Writ Petition. Thus, for the reasons already stated by the learned Single Judge in the judgment impugned in this Writ Appeal as supplemented by the reasons in this judgment, the Writ Appeal fails and is accordingly dismissed.
Sd/- A.K.JAYASANKARAN NAMBIAR JUDGE Sd/- MOHAMMED NIAS C.P.
JUDGE mns