Karnataka State Licenced Electrical Association -R- vs. The State Of Karnataka

WP/100415/2025HC KarnatakaGSTCNR KAHC02001122202529 January 2025Bench: M.NAGAPRASANNA5 pages

For Petitioner: SRI. HEMANTHKUMAR L. HAVARAGI, ADVOCATEFor Respondent: SRI SHARAD V. MAGADUM, AGA

AI SummaryDismissed

Facts

The petitioner, Karnataka State Licensed Electrical Association (R) Dharwad District Committee, filed a writ petition challenging a tender notification dated 04.11.2024, issued by the respondent No. 4 (Superintendent Engineer, KPTCL). The petitioner contended that the tender, which was for servicing, shift, and maintenance of substations, should have excluded Goods and Services Tax (GST) as per a circular dated 09.08.2024 issued by the respondent No. 2 (Chief Secretary, Department of Finance, State of Karnataka). The petitioner sought to quash the tender notification and direct the respondent No. 4 to re-issue it without GST, in line with the aforementioned circular.

Held

The Court held that the circular dated 09.08.2024 is unequivocal in its direction that in tenders issued by the State or its instrumentalities, GST should be excluded only insofar as works contracts are concerned. The Court noted that the tender in the present case, for servicing, shift, and maintenance of substations, is admittedly not a works contract but a service contract. Therefore, the circular, which deals exclusively with works contracts, would not come to the aid of the petitioner. Consequently, the Court found no merit in the petitioner's contention and dismissed the petition.

Key Issues

1. Whether the circular dated 09.08.2024, which mandates the exclusion of GST in tender notifications, is applicable to the tender for servicing, shift, and maintenance of substations issued by KPTCL? Petitioner's argument: The petitioner argued that the circular dated 09.08.2024 is applicable to the tender in question, and therefore, GST should have been excluded from the tender notification. They relied on the circular to support their claim that GST should not be included. Respondent's argument: The respondent argued that the circular dated 09.08.2024 specifically deals with 'works contract' and is not applicable to the tender for servicing, shift, and maintenance of substations, which is a service contract.

Sections Cited

Article 226, Article 227

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

- 1 - NC: 2025:KHC-D:1767 WP No. 100415 of 2025 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 29TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR. JUSTICE M.NAGAPRASANNA WRIT PETITION NO. 100415 OF 2025 (GM-TEN) BETWEEN: KARNATAKA STATE LICENCED ELECTRICAL ASSOCIATION (R) DHARWAD DISTRICT COMMITTEE, MALAPUR LAST BUS STOP, UDAYA NAGAR, DHARWAD- 580008, REPRESENTED BY ITS VICE-PRESIDENT. …PETITIONER (BY SRI. HEMANTHKUMAR L. HAVARAGI, ADVOCATE) AND: 1. THE STATE OF KARNATAKA, DEPARTMENT OF POWER, BY ITS PRL. SECRETARY, VIDHANA SOUDHA, BENGALURU, PIN- 560001. 2. THE CHIEF SECRETARY DEPARTMENT OF FINANCE STATE OF KARNATAKA, VIDHANA SOUDHA, BENGALURU, PIN- 580001. 3. THE DEPUTY COMMISSIONER, DHARWAD, DISTRICT. DHARWAD, PIN- 580001. 4. THE SUPERINTENDENT ENGINEER, K.P.T.C.L., VIDYUT NAGAR, KARWAR ROAD, HUBBALLI, TQ. HUBBALLI, DISTRICT. DHARWAD, PIN- 580024. …RESPONDENTS (BY SRI SHARAD V. MAGADUM, AGA) Digitally signed by VISHAL NINGAPPA PATTIHAL Location: High court of Karnataka, Dharwad Bench, Dharwad - 2 - NC: 2025:KHC-D:1767 WP No. 100415 of 2025 THIS WRIT PETITION IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA IS PRAYING TO, A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE IMPUGNED TENDER NOTIFICATION BEARING NO. 903/AEAM(V)/PA(KAMATTUNI)/KANIEAM(KA) SAKANIEAM-3 AND 4/2024-25/CYS-41 DATED. 04/11/2024, ISSUED BY THE RESPONDENT NO.4 THROUGH VIJAYA VANI PAPER, VIDE ANNEXURE-B. A WRIT IN THE NATURE OF MANDAMUS DIRECTING THE RESPONDENT NO.4 TO RE-ISSUE THE TENDERS NOTIFICATION CALLING FOR CARRYING OUT SHIFT DUTIES AND OPERATIONS OF 400KV, 220KV, 110KV AND 110KV KPTCL-SUB- STATIONS TO ALL TRANSMISSION W AND M/M WITHOUT GST AS PER CIRCULAR BEARING NO. AAE 417 VECHCHA-12/2024 DATED. 09/08/2024 ISSUED BY THE RESPONDENT NO.2, VIDE ANNEXURE-A. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

ORAL ORDER (PER: THE HON'BLE MR. JUSTICE M.NAGAPRASANNA)

The petitioner is before this Court, calling in question notice inviting tender dated 04.11.2024, on a solitary score that payment of GST is exempted in terms of a Circular dated 09.08.2024. NC: 2025:KHC-D:1767

Heard the learned counsel Sri.Hemanthkumar L.Havaragi appearing for the petitioner and the learned AGA Sri.Sharad V.Magadum for the respondent-State.

The respondent-KPTCL issues a notice inviting tender calling for applications from eligible tenderers for the purpose of servicing, shift and maintenance of substations. The contention of the petitioner is that, GST should be excluded from such tender, but GST has been included in the tender, which is contrary to Circular dated 09.08.2024. The Circular reads as follows: G¯ÉèÃTvÀ ¸ÀÄvÉÆÛÃ¯ÉAiÀÄ°è PÁªÀÄUÁjUÀ¼À mÉAqÀgÀÄUÀ¼À£ÀÄß PÀgÉAiÀÄÄªÀ ¸ÀAzÀ¨sÀðzÀ°è GST ªÉÆvÀÛªÀ£ÀÄß ¸ÀéAiÀÄA ZÁ°vÀªÁV vÀAvÁæA±ÀzÀ°è ¯ÉPÀÌºÁQ vÉÆÃj¸ÀÄªÀ §UÉÎ ¸ÀÆPÀÛ ªÀåªÀ¸ÉÜ ªÀiÁqÀ®Ä DPAR (e-Gov) gÀªÀjUÉ ¤¢ðµÀÖªÁzÀ ¸ÀÆZÀ£ÉUÀ¼À£ÀÄß ¤ÃqÀ¯ÁVvÀÄÛ. DzÀgÉ, F PÀÄjvÀÄ mÉAqÀgïUÀ¼À£ÀÄß PÀgÉAiÀÄªÀ ªÀÄvÀÄÛ ªÀiË®åªÀiÁ¥À£À ªÀiÁqÀÄªÀ ¸ÀAzÀ¨sÀðUÀ¼À°è UÉÆAzÀ® GAmÁVgÀÄªÀÅzÀÄ ¸ÀPÁðgÀzÀ UÀªÀÄ£ÀPÉÌ §A¢gÀÄvÀÛzÉ. F »£Àß¯ÉAiÀÄ°è ¥Àæ¸ÁÛ¦vÀ «µÀAiÀÄzÀ PÀÄjvÀÄ F PÉ¼ÀV£À ¸ÀÆZÀ£ÉUÀ¼À£ÀÄß ¤ÃqÀ¯ÁVzÉ.

FUÁUÀ¯ÉÃ ¸ÀPÁðgÀ¢AzÀ UniSR C¼ÀªÀrPÉ §UÉÎ ¤ÃqÀ¯ÁzÀ ¸ÀPÁðgÀzÀ DzÉÃ±ÀzÀ°è£À ¤zÉÃð±À£ÀUÀ¼ÀAvÉ CAzÁdÄ ¥ÀnÖAiÀÄ°è GST ªÉÆvÀÛªÀ£ÀÄß ¥ÀævÉåÃPÀªÁV ¸ÉÃ¥ÀðzÀ ªÀiÁqÀ¨ÉÃPÁVzÀÄÝ, CzÀ£ÀÄß vÀAvÁæA±ÀzÀ°è ¸ÀéAiÀÄAZÁ°vÀªÁV ¯ÉPÀÌºÁQ ºÉÆÃj¸À®Ä DPAR(e-gov) ¤AzÀ PÀæªÀÄªÀ»¸ÀvÀPÀÌzÀÄÝ.

¸ÀPÁðgÀ¢AzÀ FUÁUÀ¯ÉÃ C£ÀÄªÉÆÃ¢¸À¯ÁzÀ KPÀgÀÆ¥À C£ÀÄ¸ÀÆa zÀgÀUÀ¼À (UniSR) C£ÀéAiÀÄ vÀAiÀiÁj¸À¯ÁzÀ CAzÁdÄ ¥ÀnÖAiÀÄ°è GST ªÉÆvÀÛªÀ£ÀÄß ºÉÆgÀvÀÄ¥Àr¹ mÉAqÀgïVlÖ ªÉÆ§®UÀ£ÀÄß (Amount put to tender) ¤UÀ¢¥Àr¹, £ÀzÀj ªÉÆvÀÛPÉÌ mÉAqÀgï DºÁé¤¸ÀÄªÀÅzÀÄ. NC: 2025:KHC-D:1767

UÀÄwÛUÉzÁgÀgÀÄ mÉAqÀgïVlÖ ªÉÆ§®VUÉ JzÀÄgÁV mÉAqÀgï£À°è GST ºÉÆgÀvÀÄ¥Àr¹ ¤ÃqÀÄªÀ zÀgÀUÀ¼À£ÀÄß vÀÄ®£À ªÀiÁr mÉAqÀgÀÄzÁgÀgÀ£ÀÄß L1 ¤zsÀðj¸À®Ä vÀAvÀæA±ÀzÀ°è PÀæªÀÄªÀ»¸ÀÄªÀÅzÀÄ.

UÀÄwÛUÉzÁgÀjAzÀ ¥ÀqÉAiÀÄ¯ÁUÀÄªÀ EMD, Performance, Currente Gurity Depa ªÀÄÄAvÁzÀªÀÅÅUÀ¼À ¤ªÀðºÀuÉUÉ ¸ÀA§A¢ü¹zÀAvÉ ªÉÄÃ®ÌAqÀAvÉ ¤UÀ¢¥Àr¸À¯ÁzÀ mÉAqÀgÀ£ÀÄß ªÉÆ§®UÀ£ÀÄß ªÀiÁvÀæ ¥ÀjUÀtÂ¸ÀÄªÀÅzÀÄ.

F jÃwAiÀiÁV mÉAqÀgïVlÖ ªÉÆ§®UÀÄ ªÀÄvÀÄÛ GST ªÉÆ§®UÀÄ ¸ÉÃjzÀAvÉ MmÁÖgÉ ªÉÆvÀÛªÀÅ DqÀ½vÁvÀäPÀ C£ÀÄªÉÆÃzÀ£É ¤ÃrzÀ ªÉÆvÀÛªÀ£ÀÄß «ÄÃgÀ¢gÀÄªÀÅzÀ£ÀÄß DAiÀiÁ ¸ÀAUÀæºÀuÁ ¥Áæ¢üPÁgÀUÀ¼ÀÄ RavÀ¥Àr¹PÉÆ¼ÀîvÀPÀÌzÀÄÝ.

UÀÄwÛUÉzÁgÀgÉÆA¢UÉ ªÀiÁrPÉÆ¼Àî¯ÁUÀÄªÀ M¥ÀàAzÀzÀ°è, M¥ÀàAzÀzÀ ªÉÆvÀÛ ªÀÄvÀÄÛ CzÀgÀ ªÉÄÃ°£À GST ªÉÆvÀÛªÀ£ÀÄß ¥ÀævÉåÃPÀªÁV vÉÆÃj¸ÀvÀPÀÌzÀÄÝ. ªÀÄÄAzÀÄªÀgÉzÀÄ, M¥ÀàAzÀzÀ ZÁ°Û CªÀ¢üAiÀÄ°è GST zÀgÀUÀ¼ÀÄ ¥ÀjµÀÌgÀuÉAiÀiÁzÀ°è CzÀgÀ£ÀéAiÀÄ ¥ÁªÀw / »A¥ÁªÀw ªÀiÁqÀ®Ä ¸ÀPÁðgÀ ªÀÄvÀÄÛ UÀÄwÛUÉzÁgÀgÀÄ §zÀÞgÀgÁVgÀÄvÁÛgÉ JA§ CA±ÀªÀ£ÀÄß M¥ÀàAzÀzÀ°è ¸ÉÃ¥ÀðqÉ ªÀiÁqÀvÀPÀÌzÀÄÝ.

ªÉÄÃ°£À ¸ÀÆZÀ£ÉUÀ¼À£ÀÄß ¸ÀPÁðgÀzÀ J¯Áè E¯ÁSÉUÀ¼ÀÄ ºÁUÀÆ vÀªÀÄä C¢üÃ£ÀzÀ°è PÁAiÀÄð¤ªÀð»¸ÀÄªÀ ¤UÀªÀÄ, ªÀÄAqÀ½UÀ¼ÀÄ ªÀÄvÀÄÛ ¸ÁéAiÀÄvÀÛ ¸ÀA¸ÉÜUÀ¼ÀÄ PÀlÄÖ¤mÁÖV ¥Á°¸ÀÄªÀÅzÀ£ÀÄß J¯Áè ¸ÀAUÀæºÀuÁ ¥Áæ¢üPÁgÀUÀ¼ÀÄ RavÀ¥Àr¹PÉÆ¼ÀîvÀPÀÌzÀÄÝ.”

The Circular is unequivocal that in tenders of the State or instrumentality of the State, insofar as works contract is concerned, excluding GST, the tender notification should be issued. The subject tender in the case at hand, is admittedly not a works contract, but a tender notification issued for the purpose of servicing, shift and maintenance of substations. Therefore, it is admittedly NC: 2025:KHC-D:1767 a service contract. The circular would not come to the aid of the petitioner as it deals with works contract.

In that light, there is no merit involved in what the petitioner seeks to project in the case at hand. Petition being devoid of merit, stands disposed. (M.NAGAPRASANNA) JUDGE

KGK List No.: 1 Sl No.: 43

Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.