Parvati Devi vs. State Of Rajasthan

Held

The Court held that the petitioners are free to avail their statutory remedies of filing replies to show cause notices or appeals against final assessment orders, irrespective of the outcome of the writ petitions. Regarding the demand of GST on royalty, the Court found that this issue was concluded by the judgment dated 27.09.2022 in Sudershan Lal Gupta vs. UOI & Ors. and connected matters. For the issue concerning the demand of GST on DMFT contribution, the Court permitted the petitioners in ten specific writ petitions (listed in the judgment) to continue pursuing this relief while denying relief against the imposition of GST on royalty. Consequently, the Court deferred these ten writ petitions for consideration of the DMFT issue and dismissed the remaining batch of writ petitions in light of the Sudershan Lal Gupta judgment.

Facts

A batch of writ petitions challenged show cause notices and assessment orders issued by the respondent GST Department, demanding GST on royalty paid by the petitioners to the Mining Department for their mining leases. In ten specific writ petitions, an additional issue regarding the demand of royalty on contribution to the District Mineral Foundation Trust (DMFT) was also raised. The petitioners argued that a previous Division Bench judgment at the Jaipur Bench, in Sudershan Lal Gupta vs. Union of India & Ors., which dismissed similar petitions, was based on different facts (service tax on royalty) and did not adjudicate on the merits, thus prejudicing their right to raise objections. The respondents contended that the identical challenge to GST on royalty had already been rejected by a Coordinate Bench.

Key Issues

1. Whether the petitioners' right to agitate against the show cause notices on merits has been frustrated by the Division Bench judgment in Sudershan Lal Gupta (supra), which relied on earlier cases concerning service tax on royalty, a distinct issue from GST on royalty? 2. Whether the demand of GST on royalty paid for mining leases is sustainable? 3. Whether the demand of royalty on contribution to DMFT is sustainable? Petitioner's arguments: The petitioners contended that the judgment in Sudershan Lal Gupta (supra) was not on merits and dealt with service tax, not GST, on royalty, thus unfairly dismissing their petitions. They argued they would be prejudiced as their right to raise objections on merits was curtailed. Respondent's arguments: The respondents argued that a Coordinate Bench had already rejected identical challenges to the demand of GST on royalty in its judgment dated 27.09.2022, and therefore, these writ petitions should also be dismissed.