Mr Prabhakar Yeyyadi vs. State Of Karnataka

Facts

The petitioner, Mr. Prabhakar Yeyyadi, entered into an agreement with the Mangalore City Corporation (respondent No. 2) for the construction of a market. The bid was accepted for Rs. 40,10,41,999/-. The agreement contained a clause stipulating that any Goods and Services Tax (GST) applicable, as decided by the GST Council, would be paid at the time of payment and reimbursed by the Corporation upon production of payment receipts. The petitioner paid GST amounting to Rs. 2,12,23,333/- to the GST department. He subsequently submitted a representation to respondent No. 2 seeking reimbursement of this GST amount along with interest. The petitioner's grievance was that this representation remained unconsidered.

Held

The Court directed respondent No. 2, the Mangalore City Corporation, to consider the representation submitted by the petitioner. This consideration is to be made in terms of the agreement dated 27.12.2019. The Court further ordered that respondent No. 2 should pass an appropriate order in accordance with the law within a period of four weeks from the date of receipt of a certified copy of the order. The Court did not make any specific findings on the merits of the GST reimbursement claim itself, nor did it quantify the interest, as the primary focus was on directing the consideration of the representation. The issue of whether the GST amount was indeed reimbursable under the specific terms of the agreement and the GST law was implicitly left for the respondent to decide in the first instance.

Key Issues

1. Whether the Court should direct respondent No. 2 to consider the petitioner's representation dated 19.02.2022 for reimbursement of GST amount of Rs. 2,12,23,333/- along with interest, as per the agreement dated 27.12.2019? Petitioner's Contention: The petitioner argued that the agreement clearly stipulated reimbursement of GST paid by him upon production of payment receipts. He sought a direction for the respondent to consider his representation and reimburse the GST amount along with interest. Respondent No. 2's Contention: Respondent No. 2 submitted that the representation submitted by the petitioner would be considered within a reasonable time, in accordance with the terms of the agreement.