M/S Navbharat Buildcon PVT. LTD. vs. Government Of Rajasthan

CW/13405/2023HC RajasthanGSTCNR RJHC02068400202306 March 2025Bench: SUDESH BANSAL4 pages

AI SummaryRemanded

Facts

The petitioner, M/s Navbharat Buildcon Pvt. Ltd., filed a writ petition seeking the benefit of an order dated 07.01.2021 and equitable adjustment of its contract price due to an increase in the GST rate. The petitioner was awarded a work contract for the construction of an Anicut on Morel River near Kalyanpura, Dausa, vide a work order dated 27.12.2021. The petitioner contended that Clause-36E, inserted into the Public Works Financial & Accounts Rules, Part-II by the Rajasthan Government's order dated 07.01.2021, and a subsequent increase in GST on work contracts for irrigation works from 12% to 18% effective 18.07.2022, obligated the respondents to grant the benefit of the 2021 order and adjust the contract price. The petitioner had made representations and served a legal notice, which remained unaddressed, leading to the filing of the writ petition.

Held

The Court disposed of the writ petition with directions, acknowledging the limited prayer made by the petitioner's counsel. The Court permitted the petitioner to submit a detailed representation outlining their grievances and prayer, supported by documents and grounds, to the respondents within four weeks. Upon receipt, the respondents were directed to consider and decide the representation by a reasoned and speaking order, preferably within four weeks of its receipt. The Court also stipulated that if the petitioner's grievances were not satisfactorily addressed or the representation was decided against them, it would be open for the petitioner to avail further legal remedies in accordance with the law. The Court did not make a final determination on the merits of the petitioner's claim for equitable adjustment of the contract price or the benefit of the order dated 07.01.2021, leaving these substantive issues to be decided by the respondents in the first instance.

Key Issues

1. Whether the petitioner is entitled to the benefit of the order dated 07.01.2021 and equitable adjustment of the contract price due to the increase in the GST rate from 12% to 18% effective 18.07.2022, in light of Clause-36E of the Public Works Financial & Accounts Rules, Part-II, and the Government of India's notification dated 13.07.2022? (Question of law). Petitioner's Arguments: The petitioner argued that the insertion of Clause-36E and the subsequent increase in the GST rate mandated the respondents to provide equitable adjustment of the contract price. They relied on the principle that similar benefits have been extended by other departments, such as CPWD. The petitioner also asserted that their prior representations and legal notice were not responded to. Respondents' Arguments: The learned Additional Advocate General for the respondents stated that if the petitioner filed a representation, it would be considered and decided in accordance with the law.

Sections Cited

Clause-36E

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

[2025:RJ-JP:10277] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Civil Writ Petition No. 13405/2023 M/s Navbharat Buildcon Pvt. Ltd., Having Its Office At Khasara No. 300/7, Near Shrenik Marble, Makrana Road, Kishangarh- 305801 (Raj.)Through Its Director - Shri Shrenik Luhadia ----Petitioner Versus 1. Government Of Rajasthan, Department Of Water Resources, Govt. Secretariat, Janpath, Jaipur - 302005 Through The Additional Chief Secretary 2. The Chief Engineer Cum Addl. Secretary, Water Resources Rajasthan, Indira Gandhi Nahar Pariyojana, Bhawani Singh Road, Near Ambedkar Circle, Jaipur - 302005 (Rajasthan) 3. Additional Chief Engineer, Water Resources Zone, Sinchai Bhawan, Near Saras Dairy, Jln Marg, Jaipur- 302015 (Rajasthan) 4. The Executive Engineer, Water Resource Division, Dausa - 303303 (Rajasthan) ----Respondents For Petitioner(s) : Ms. Sukriti Kasliwal For Respondent(s) : Mr. B.S. Chhaba, AAG HON'BLE MR. JUSTICE SUDESH BANSAL

Order 06/03/2025

Instant writ petition has been filed by the petitioner – Ms. Navbharat Buildcon Pvt. Ltd., with the following prayer:- “It is, therefore, humbly prayed that this Hon’ble Court may kindly be pleased to allow this writ petition and direct Respondents to give benefit of order dated 07.01.2021 (Annexure-5) to the Petitioner in the subject matter and Tender/Work contract (Annexure-3) and it may also be directed upon the Respondents to make equitable adjustment of contract price on account of

[2025:RJ-JP:10277] (2 of 4) [CW-13405/2023] increase in rate of GST from 12% to 18% in running bills and final bill for the contract in question and the Respondents may also be directed to release payment already made by the Petitioner towards increase in the rate of GST w.e.f. 18.07.2022 along with interest @ 18% thereon to the Petitioner.”

Learned counsel for petitioner submits that bids were invited through NIT bearing No.06/2021-22 dated 09.08.2021 for construction of Anicut on Morel River near Kalyanpura, GP Kankariya, Tehsil Lalsot, Dausa and in the process of tender, petitioner was declared successful bidder and work order dated 27.12.2021 has been issued in favour of the petitioner.

Learned counsel for the petitioner also submits that a Clause-36E has been inserted in the Public Works Financial & Accounts Rules, Part-II by way of amendment under the order dated 07.01.2021 issued by the Government of Rajasthan, Finance Department and thereafter, the Government of India, Ministry of Finance vide notification dated 13.07.2022 has increased the rate of GST on work contract of dams and canals or other irrigation works from 12% to 18% effective from 18.07.2022, hence, in view of the such amended provision i.e. Clause-36E and the increase of rate of GST, respondents are under obligation to grant benefit of the order dated 07.01.2021 to the petitioner as also to make equitable adjustment of the contract price due to increase of the GST rate.

It has been submitted that the petitioner has made representation and also served a legal notice, but the same have not been responded, hence, the instant writ petition has been filed before this Court.

[2025:RJ-JP:10277] (3 of 4) [CW-13405/2023]

During the course of arguments, learned counsel for the petitioner submit that the petitioner may be permitted to file a fresh representation before the respondents to consider its grievances and to make equitable adjustment of the contract price on account of increase in rate of GST from 12% to 18% w.e.f. 18.07.2022 since similar benefit has been extended by the other Department like CPWD Department Technology etc.

Learned Additional Advocate General appearing on behalf of the respondents submits that if the petitioner would file any representation, same shall be considered and decided in accordance with law.

In view of the limited prayer of learned counsel appearing for the petitioner, the instant writ petition is hereby disposed of with the following directions: (i) The petitioner is permitted to submit a detailed representation incorporating his grievances and prayer supported with documents and grounds before the respondents within a period of four weeks from today. (ii) On receipt of the representation, respondents shall consider and decide the representation by a reasoned and speaking order, preferably within a period of four weeks from the receipt of the representation. (iii) In case, grievances of the petitioner are not satisfactorily dealt with and representation is decided against the petitioner, it shall be open for the petitioner to avail the legal remedy accordance with law.

[2025:RJ-JP:10277] (4 of 4) [CW-13405/2023]

Stay application and other pending application(s), if any, stand disposed of. (SUDESH BANSAL),J SUNIL SOLANKI /88

Reproduced from the public record of the Rajasthan High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.