N V Kulkarni Construction Company vs. The State Of Karnataka - Karnataka High Court, 27 June 2024

Cause title — parties, addresses and appearances

- 1 - NC: 2024:KHC-D:8778 WP No. 103557 of 2024 IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH DATED THIS THE 27TH DAY OF JUNE, 2024 BEFORE THE HON'BLE MR JUSTICE PRADEEP SINGH YERUR WRIT PETITION NO.103557 OF 2024 (T-RES) BETWEEN: N.V. KULKARNI CONSTRUCTION COMPANY, A REGISTERED PARTNERSHIP FIRM UNDER THE INDIAN PARTNERSHIP ACT, 1932, B-15, PANDARI KRUPA, VIVEK NAGAR EAST, VIJAYAPURA-586101, R/BY ITS PARTNER, SRI. NARYAN RAO VITTAL RAO KULKARNI, AGED ABOUT 54 YEARS, S/O SRI. VITTAL RAO KULKARNI. … PETITIONER (BY SRI M. THIRUMALESH AND SMT. ROOPA ANAVEKAR, ADVOCATES) AND: 1. THE STATE OF KARNATAKA, FINANCE DEPARTMENT, II FLOOR, VIDHANA SOUDHA, BENGALURU-560001 REP. BY ITS ADDL. CHIEF SECRETARY. 2. COMMISSIONER OF COMMERCIAL TAXES, GOVERNMENT OF KARNATAKA, VANIJYA THEREIGE KARYALAYA, 1ST MAIN ROAD, GANDHI NAGAR, BENGALURU-560009. 3. EXECUTIVE ENGINEER, PROJECT DIVISION, RURAL DEVELOPMENT AND PANCHAYAT RAJ DEPT., BADEKAMAN ROAD, VIJAYAPURA-586101. BHARATHI H M Digitally signed by BHARATHI H M Location: HIGH COURT OF KARNATAKA DHARWAD BENCH Date: 2024.07.06 12:16:26 +0530 - 2 - NC: 2024:KHC-D:8778 WP No. 103557 of 2024 4. EXECUTIVE ENGINEER, KRISHNA BHAGYA JALA NIGAM LTD., MLI DIVISION NO.2, BABLESHWAR, VIJAYAPURA-586101. 5. EXECUTIVE ENGINEER, THE NATIONAL HIGHWAY DIVISION, VIJAYAPURA-586101. … RESPONDENTS (BY SRI SHIVAPRABHU S. HIREMATH, ADDL. GOVERNMENT ADVOCATE.) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO: I) ISSUE A WRIT IN THE NATURE OF WRIT OF DECLARATION, DECLARING THAT THE PETITIONER IS ENTITLED FOR REIMBURSEMENT OF THE DIFFERENTIAL GST AMOUNT PAID BY THE PETITIONER FOR THE WORKS EXECUTED AS PER REPRESENTATIONS DATED 03-01-2024 AND 13-01-2024 FILED BEFORE RESPONDENT NOS.3, 4 AND 5- ANNEXURES-F, G AND H. II) ISSUE OF WRIT OR SUCH OTHER ORDER IN THE NATURE OF WRIT OF MANDAMUS DIRECTING RESPONDENT NOS.3, 4 AND 5 TO REFUND THE DIFFERENTIAL GST AMOUNT PAID BY THE PETITIONER FOR THE WORK EXECUTED AS PER REPRESENTATIONS DATED 03-01-2024 AND 13-01-2024 FILED BEFORE RESPONDENT NOS.3, 4 AND 5 ANNEXURES F, G AND H. III) ISSUE OF WRIT OR SUCH OTHER ORDER DIRECTING THE RESPONDENT NO.1, THE STATE GOVERNMENT, TO ISSUE A CIRCULAR/POLICY TO ADDRESS THE ISSUE OF PAYMENT OF GST ON WORKS CONTRACT WHICH ARE EXECUTED UNDER OLD SCHEDULE OF RATES IN RESPECT OF WORKS EXECUTED FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES OF GOVERNMENTAL AUTHORITY WHEREIN GST IS NOT PAID BY THE AWARDER/EMPLOYER OF WORKS CONTRACTOR BUT LEVIED AND PAID BY THE PETITIONER TO GST DEPARTMENT AND ETC.,. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING: - 3 - NC: 2024:KHC-D:8778 WP No. 103557 of 2024

ORDER Heard the learned counsel for the petitioner.

Learned Addl. Government Advocate is directed to take notice for all the respondents.

It is the case of the petitioner that he is a Class-I contractor engaged in execution of works contracts and registered in the Central Goods and Services Tax Act and Karnataka Goods and Services Tax Act, 2017. The petitioner executed contracts as per terms and conditions laid down in the tenders floated by respondent No.3 at the time of inviting the tender. During the pre-GST regime the tax rate was 4% under the Karnataka Value Added Tax Act. Subsequent to introduction of GST regime, the rate of tax increased to 12% resulting in significant disparity on the tax rates applied. Therefore, learned counsel for the petitioner contends that the transition has lead to overpayment of tax by the petitioner as at the time of inviting the tender it was 4% and in view of the GST coming into force w.e.f. 01.07.2017, it was increased to 12%. The petitioner NC: 2024:KHC-D:8778 executing the contract with respondent No.5 is not disputed. Of course there cannot be any dispute with regard to old regime of pre-GST and post regime of GST, so also the tax rates. In view of the change of regime, petitioner made a representation to the respondents No.3 to 5 to consider their representation and reimburse the excess tax paid. However the representations made by the petitioner were not considered. Due to the inaction of the respondents, petitioner is before this Court seeking interference.

Learned counsel for the petitioner relies on the judgment of this Court in a similar case in W.P.No.106756/2023, which relied upon at the batch of petitions in W.P.No.9721/2019 and connected matters disposed of on 11.04.2023 wherein similar issue had arisen and the petitions were allowed.

Learned Addl. Government Advocate representing the respondents submits, there is no dispute with regard pre and post regime of GST and the percentage that was imposed at the time of and post allotment of tender. He also fairly contends that he cannot dispute the judgment referred NC: 2024:KHC-D:8778 by the learned counsel for petitioner and to that extent he submits that this petition could be disposed of in view of the earlier judgment passed by this Court.

In view of the submission made by the learned counsel for petitioner as well as learned Addl. Government Advocate and the decisions rendered by this Court stated herein supra, wherein the entire details have been laid down and the orders have been passed by this Court in the connected matters, nothing much survives for consideration except following the judgment in the case of W.P.No.9721/2019 and connected matters. Accordingly, I pass the following: ORDER i) The petition is disposed of directing the respondents to consider the representation of the petitioners produced at Annexure-F, G and H and pass suitable orders in accordance to the above mentioned judgments stated supra in W.P.No.9721/2019 and connected matters and if the petitioner is entitled to refund, for having paid the excess NC: 2024:KHC-D:8778 amount, the same shall be refunded/adjusted within a period of four weeks from the date of receipt of a copy of this order. JUDGE

MRK CT:BCK List No.: 1 Sl No.: 35