Vub Engiineering PVT. LTD. vs. State Of Rajasthan

Facts

The petitioner, Vub Engineering Pvt. Ltd., filed a writ petition before the Rajasthan High Court at Jaipur. The petitioner's primary grievance was that the respondents, the State of Rajasthan and its officials from the Water Resource Department, had not decided representations seeking payment of an amount, including Goods and Services Tax (GST), as per Clause 15.21 of their contract. The petitioner argued that this clause stipulated that while taxes would be inclusive, any adverse change in legislation, such as inflation or new levies, should either be considered under the price variation clause or be payable by the respondents. The petitioner relied on a previous judgment from a co-ordinate bench of the same court.

Held

The Court held that the respondents, specifically respondent No. 2 (the competent authority), were directed to consider the representation filed by the petitioner. The Court did not delve into the merits of the petitioner's claim regarding the interpretation of Clause 15.21 or the entitlement to GST payment. Instead, the focus was on ensuring that the representation was considered. The Court directed that if the representation was filed within seven days, the competent authority would grant an audience to the petitioner's advocate or the petitioner in person on April 28, 2026, at 11:00 AM. Following this, a speaking order was to be passed in accordance with the law. The ratio decidendi is that administrative authorities must consider and decide representations filed by parties in a timely and lawful manner, providing an opportunity for hearing. The operative direction was for the respondent No. 2 to consider the representation and pass a speaking order.

Key Issues

1. Whether the respondents are obligated to decide the petitioner's representation seeking payment of an amount, including GST, in terms of Clause 15.21 of the contract, considering the statutory nature of GST and its potential adverse impact on the petitioner due to legislative changes? (Question of law) Petitioner's arguments: The petitioner contended that Clause 15.21 of the contract mandates that any adverse changes in legislation, including the levy of GST, should be compensated. They argued that GST is an indirect tax and its imposition or changes thereof should be considered for payment under the contract, either through the price variation clause or directly. They relied on the judgment in M/s N.G. Gadhiya Versus State of Rajasthan & Ors. Respondents' arguments: The judgment records that learned counsel for the respondents marked attendance, but it does not record any specific arguments made by them in opposition to the petitioner's claims.