A.K. Constructions vs. State Of Chhattisgarh

Facts

The petitioner, A.K. Constructions, represented by its partner Rakesh Agrawal, filed a writ petition before the High Court of Chhattisgarh at Bilaspur. The petitioner's grievance was the inaction of the respondents (State of Chhattisgarh and its officials) in refunding GST collected from the petitioner during the execution of a contract awarded prior to the GST regime (effective from 01.07.2017). The petitioner contended that the Chhattisgarh Government had issued a circular allowing refunds for GST paid on contracts executed before 01.07.2017, upon production of certificates of GST payment. Despite repeated approaches, the petitioner alleged no action was taken by the respondents regarding the refund. The State counsel indicated that the claim would be decided after verification of facts and its eligibility under the relevant government circulars.

Held

The Court disposed of the writ petition by directing the State Authorities to immediately process the petitioner's claim for the refund of GST. This processing is to be done after due verification of facts and the petitioner's entitlement. The Court emphasized that the decision should be made in light of the State Government's earlier order dated 10.10.2018 and all subsequent relevant orders. The Court also noted the petitioner's contention that similar GST refunds have been granted by the government in other cases. The State Authorities were given an outer limit of 90 days from the receipt of the order to take an appropriate decision. The Court did not explicitly leave any issue undecided, but the core of the decision was to direct prompt action on the refund claim.

Key Issues

1. Whether the petitioner is entitled to a refund of GST collected on a contract executed prior to the GST regime, as per the Chhattisgarh Government's circulars? 2. Whether the inaction of the State authorities in processing the petitioner's refund claim is justified? Petitioner's arguments: The petitioner argued that the contract was awarded before the GST regime, and the government itself had issued a circular providing for the refund of GST paid on such pre-GST contracts. They asserted that despite their repeated follow-ups, the respondents have failed to act on their refund claim, causing them financial prejudice. The petitioner also highlighted that in similar cases, the government has already refunded GST. Revenue's arguments: The State counsel submitted that the claim would be considered subject to verification of facts and whether the petitioner's claim falls within the scope of the circulars and orders issued by the State Government concerning the refund of GST for contracts awarded prior to 01.07.2017. No specific provision or precedent was cited by the revenue.