Jitendra Kumar Parida vs. State Of Odisha

Held

The Court acknowledged the petitioner's grievance regarding the differential tax amount due to the GST transition. It noted the submission by the revenue/State regarding the revised guidelines issued on December 10, 2018. The Court directed the petitioner to make a comprehensive representation before the appropriate authority within four weeks, detailing their grievance. The authority was then instructed to consider and dispose of this representation in light of the aforementioned revised guidelines dated December 10, 2018, as expeditiously as possible, preferably by February 29, 2020. The Court also stated that if the petitioner remained aggrieved by the authority's decision, they would be at liberty to challenge it. No coercive action was to be taken against the petitioner until February 29, 2020. The Court did not make a final determination on the reimbursement amount but provided a procedural path for resolution.

Facts

The petitioner, a works contractor, filed a writ petition challenging the action of the opposite parties (revenue/State) in 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 works contracts entered into before the GST regime, which was not envisaged in the original agreements. The revenue/State submitted revised guidelines issued by the Finance Department of the Government of Odisha on December 10, 2018, superseding earlier guidelines from December 7, 2017. These revised guidelines provided a procedure for determining and reimbursing the differential GST amount for works contracts tendered before July 1, 2017, but executed partly or wholly after that date.

Key Issues

1. Whether the petitioner is entitled to reimbursement of the differential tax amount arising from the change in tax regime from VAT to GST for works contracts entered into prior to July 1, 2017, but executed thereafter? The petitioner argued that the introduction of GST necessitated paying tax that was not contemplated in the original agreements, leading to a financial burden. They sought reimbursement of this additional tax liability. The revenue/State contended that revised guidelines were issued on December 10, 2018, which provided a mechanism for addressing such claims. These guidelines outlined a procedure for calculating the revised GST-inclusive work value for the balance work and reimbursing the contractor if this revised value exceeded the original agreement value. The revenue relied on the Office Memorandum No. FIN-CTI-TAX-0045-2017/38535/F dated 10.12.2018.