Ishwar Singh vs. Union Of INDIA

Held

The Court held that there was no merit in the writ petition. It reasoned that a coordinate bench of the same High Court had already considered and repelled an identical challenge to the leviability of GST on royalty in the case of Sudarshan Lal Gupta vs. Union of India & Ors. Therefore, despite the petitioner's contention regarding the interpretation of the Supreme Court judgment and the pending larger bench consideration in the Supreme Court, the Court was not inclined to take a different view. The ratio decidendi is that a coordinate bench's decision on an identical issue, even if challenged or pending higher adjudication, binds other coordinate benches. The operative direction was the dismissal of the writ petition.

Facts

The petitioner, Ishwar Singh, filed a writ petition challenging orders and a notice issued by the respondent department demanding Goods and Services Tax (GST) on royalty collected by him. This challenge was identical to one previously considered by a Division Bench of the Rajasthan High Court at its Jaipur Bench in the case of Sudarshan Lal Gupta vs. Union of India & Ors. The petitioner argued that the Division Bench's interpretation of a Supreme Court judgment in State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha was incorrect. Despite this, and acknowledging that the issue of GST on royalty is pending before a nine-judge bench of the Supreme Court in the case of Mineral Area Development Authority etc. & Ors. vs. M/s. Steel Authority of India & Ors., the Court noted that a coordinate bench had already ruled on the self-same challenge.

Key Issues

1. Whether the Rajasthan High Court, Jaipur Bench, correctly interpreted the Supreme Court judgment in State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha while repelling the challenge to the levy of GST on royalty? The petitioner argued that the Division Bench in Sudarshan Lal Gupta (Supra) failed to make a correct interpretation of the Supreme Court judgment, implying that GST should not be leviable on royalty. The respondents did not record any specific arguments in the judgment, but their action of demanding GST on royalty formed the basis of the challenge.