Harbans Singh vs. Union Of INDIA

Held

The Court held that while the petitioner's arguments were noted, including the pendency of a similar issue before a nine-judge bench of the Supreme Court, a coordinate bench of the same High Court had already dealt with and dismissed an identical challenge to the leviability of GST on royalty in the case of Sudarshan Lal Gupta vs. Union of India & Ors. Consequently, the Court expressed its unwillingness to take a different view from its coordinate bench. Therefore, the writ petition was found to have no merit and was dismissed. The Court did not expressly leave any issue undecided, but its decision was based on following precedent from a coordinate bench rather than independently deciding the interpretation of the Supreme Court judgment.

Facts

The petitioner, Harbans Singh, proprietor of Nimiwal Traders, filed a writ petition challenging orders/notices issued by the respondent department demanding Goods and Services Tax (GST) on royalty collected by him. The petitioner argued that the demand was incorrect, citing a Supreme Court judgment in State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha. He contended that a Division Bench of the Rajasthan High Court at Jaipur, in a similar case (Sudarshan Lal Gupta vs. Union of India & Ors.), had misinterpreted the Supreme Court's ruling. The petitioner also noted 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.

Key Issues

1. Whether the demand of GST on royalty collected by the petitioner is legally sustainable, considering the Supreme Court judgment in State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha? 2. Whether the Division Bench of the Rajasthan High Court at Jaipur, in Sudarshan Lal Gupta vs. Union of India & Ors., correctly interpreted the Supreme Court judgment in the context of GST on royalty? Petitioner's Arguments: The petitioner argued that the demand for GST on royalty is unsustainable, relying on the Supreme Court's decision in State of Assam vs. Barak Upatyaka D.U. Karmachari Sanstha. He further contended that the Jaipur Bench of the High Court erred in its interpretation of this Supreme Court judgment in a previous case. The petitioner also highlighted that the larger issue is pending before the Supreme Court. Respondents' Arguments: The judgment does not record any specific arguments made by the respondents.