Mukesh Kumar vs. The General Manager (Civil) Mcl,Sambalpur

Held

The Court noted that the petitioner's case was identical to W.P.(C) No.10556 of 2019. The State did not dispute this. The Court referred to the revised guidelines issued by the Finance Department, Government of Odisha, on December 10, 2018, which provided a mechanism for calculating the GST-inclusive work value for balance work on contracts tendered before July 1, 2017. The Court directed the petitioner to make a comprehensive representation to the appropriate authority within four weeks, ventilating their grievance. The authority was directed to consider and dispose of this representation in light of the revised guidelines dated December 10, 2018, as expeditiously as possible, preferably by November 20, 2020. The Court also stated that if the petitioner was aggrieved by the authority's decision, they could challenge it. No coercive action was to be taken against the petitioner until November 20, 2020. The writ petition was disposed of accordingly.

Facts

The petitioner, a works contractor, filed a writ petition challenging the State's action of not reimbursing the differential tax amount arising from the transition from Value Added Tax (VAT) to Goods and Services Tax (GST) effective July 1, 2017. The petitioner's grievance was that they were required to pay GST on contracts entered into before the GST regime, which was not initially envisaged. The State had issued revised guidelines on December 10, 2018, superseding earlier guidelines from December 7, 2017, to address such issues faced by contractors. These revised guidelines provided a procedure for determining the GST-inclusive work value for balance work executed after July 1, 2017, on contracts tendered before that date based on the pre-revised Schedule of Rates (SoR-2014).

Key Issues

1. Whether the petitioner is entitled to reimbursement of differential tax amounts due to the change in tax regime from VAT to GST for works contracts entered into prior to July 1, 2017, but executed partly or wholly thereafter? (Question of law and fact, concerning the impact of GST on existing contracts). Petitioner's contention: The petitioner argued that the writ petition was identical to a previously decided case (W.P.(C) No.10556 of 2019) and should be disposed of on similar terms. The core issue was the financial burden imposed by the GST regime on contracts where the tax liability was not contemplated at the time of agreement. Revenue/State's contention: The State, represented by the Additional Government Advocate, did not dispute the petitioner's submission regarding the similarity to the previous case. The State had issued revised guidelines on December 10, 2018, to address the grievances of contractors regarding works contracts under GST.