Byasdeb Musib Nad Ors. vs. State Of West Bengal And Ors.

Facts

The petitioners, Byasdeb Musib & Ors., filed a writ petition before the High Court challenging the additional tax liability arising from government contracts. These contracts were either awarded before or after the introduction of the Goods and Services Tax (GST) regime but were executed without updating the Schedule of Rates (SOR) to incorporate applicable GST in the Bill of Quantities (BOQ) for inviting bids. The petitioners sought directions for the respondents to bear this additional tax burden and to neutralize the impact of unforeseen additional tax on ongoing contracts awarded before July 1, 2017. They also requested an update of the State SOR to include applicable GST in lieu of West Bengal VAT.

Held

The High Court disposed of the writ petition by directing the petitioners to file appropriate representations before the Additional Chief Secretary, Finance Department, Government of West Bengal, within four weeks. The Additional Chief Secretary is mandated to take a final decision on these representations within four months of their receipt, after consulting with all relevant departments. The decision-making process must include an opportunity of hearing for the petitioners or their authorized representatives. The Court also stipulated that no coercive action shall be taken against the petitioners until a final decision is reached. The Additional Chief Secretary is required to pass a reasoned and speaking order, considering all relevant judgments, including those relied upon by the petitioners, and to act in accordance with the law. The issue of the State SOR being updated was implicitly to be considered within the broader representation process.

Key Issues

1. Whether the respondents are liable to bear the additional tax liability for government contracts where the Schedule of Rates (SOR) was not updated to include applicable GST in the Bill of Quantities (BOQ) for bid invitations, for contracts awarded pre-GST and post-GST regimes? 2. Whether the impact of unforeseen additional tax burden on government contracts since the introduction of GST from July 1, 2017, for ongoing contracts awarded before that date should be neutralized? 3. Whether the State SOR should be updated to incorporate applicable GST in lieu of West Bengal VAT for future contracts? Petitioner's Contention: The petitioners argued that the lack of updated SORs and BOQs led to an unforeseen additional tax burden on them, as they had to bear the GST liability without it being factored into the contract pricing. They relied on the principle that such unforeseen burdens should be addressed by the contracting authority. Revenue/State's Contention: The judgment does not record any specific arguments or contentions made by the State or its representatives regarding the issues raised by the petitioners.