Mridula Paul vs. The Executive Engineer, Wb. State Rural Development Agency And Ors

Facts

The petitioner, Ms. Mridula Paul, proprietor of M/s. Kalpan Construction, filed a writ petition seeking directions against the Executive Engineer, West Bengal State Rural Development Agency, Burdwan 2 Division, and other respondents. The core issue revolves around government contracts, particularly those awarded before or after the introduction of GST on July 1, 2017. The petitioner contends that the Schedule of Rates (SOR) and Bill of Quantities (BOQ) for these contracts were not updated to include applicable GST, leading to an unforeseen additional tax liability for the petitioner. The petitioner seeks to have this additional tax burden neutralized and the State SOR updated to incorporate GST instead of the inapplicable West Bengal VAT.

Held

The Court did not decide the substantive issues raised by the petitioner. Instead, it disposed of the writ petition by granting the petitioner liberty to file an appropriate representation before the Additional Chief Secretary, Finance Department, Government of West Bengal. The Court directed the Additional Chief Secretary to take a final decision on this representation within four months of its receipt, after consulting with all relevant departments and providing an opportunity of hearing to the petitioner. The Court emphasized that the Additional Chief Secretary must act in accordance with law, pass a reasoned and speaking order, and consider all judgments relied upon by the petitioner. Until the final decision, no coercive action is to be taken against the petitioner. The Court noted that if the representation is not filed within four weeks, the order would have no force.

Key Issues

1. Whether the respondents are liable to bear the additional tax liability arising from the execution of government contracts awarded either in the pre-GST or post-GST regime, where the Schedule of Rates (SOR) and Bill of Quantities (BOQ) were not updated to incorporate applicable GST? 2. Whether the impact of unforeseen additional tax burden on government contracts, particularly for ongoing contracts awarded before July 1, 2017, should be neutralized by the State? 3. Whether the State SOR should be updated to incorporate applicable GST in lieu of inapplicable West Bengal VAT for government contracts? Petitioner's Arguments: The petitioner argued that the failure to update the SOR and BOQ with applicable GST has resulted in an additional, unforeseen tax burden on ongoing government contracts. They sought directions to neutralize this impact and update the State SOR. The petitioner intended to rely on judgments from various High Courts concerning similar issues. Revenue/State's Arguments: The judgment records submissions from the State but does not detail their specific arguments or any authorities, circulars, or precedents they relied upon.