Ms Imperial Fasteners PVT LTD Through Its Director Jugal Koshore vs. Central Coalfields Limited Through Its Chairman Cum Managing Director And Anr

Held

The Court did not decide the substantive issues raised by the petitioner. Instead, the petitioner's counsel sought permission to withdraw the writ petition to pursue the dispute through arbitration, invoking Clause 22 of the agreement between the parties. The counsel for CCL had argued that the writ petition was not maintainable. The counsel for CGST did not object to the withdrawal. Considering the petitioner's prayer, the High Court dismissed the writ petition as withdrawn. The Court noted that it was open for the petitioner to pursue other remedies, including arbitration, if permissible by law. The specific issues regarding the liability for GST (Compensation Cess) and the classification of Washery Rejects were therefore not adjudicated upon by the High Court.

Facts

The petitioner, M/s Imperial Fasteners Pvt. Ltd., filed a writ petition challenging a letter and bill dated August 16, 2017, issued by the Project Officer, Kathara Washery (respondent no. 2). This bill charged the petitioner Rs. 400 per tonne as GST (Compensation Cess) on Washery Rejects, in addition to the cost of Rs. 473 per tonne. The petitioner argued that the liability for this cess should be on Central Coalfields Limited (CCL), the supplier, as per Section 9(1) of the Goods and Service Tax (Compensation to States) Act, 2017, and that CCL should seek a refund as per Section 9(2). The petitioner also sought a refund of Rs. 54,85,564.00 collected as GST (Compensation Cess) for July 2017 and a declaration that Washery Rejects are not taxable under the Act. Counter affidavits were filed by CCL and CGST.

Key Issues

1. Whether the liability to pay GST (Compensation Cess) on the supply of Washery Rejects under Section 9(1) of the Goods and Service Tax (Compensation to States) Act, 2017, rests with the supplier (CCL) or the recipient (petitioner)? 2. Whether Washery Rejects fall within the category of taxable goods as defined in the Schedule of the Goods and Service Tax (Compensation to States) Act, 2017, specifically under Chapter 27? Petitioner's arguments: - The liability for GST (Compensation Cess) is on the taxable person making the supply, which is CCL, as per Section 9(1) of the GST (Compensation to States) Act, 2017. - CCL, as the supplier, should apply for refunds of such cess paid under Section 9(2). - Washery Rejects are waste products and do not fall under the specified taxable category of "Coal, briquettes, ovoids and similar solid fuel manufactured from coal, lignite, whether or not agglomerated." Revenue/State's arguments: - The judgment records that the learned counsel for CCL submitted that the writ petition is not maintainable. No specific arguments regarding the taxability or liability were recorded for CCL. - The learned counsel for CGST did not object to the prayer for withdrawal of the writ petition.