M/S. Ajeet Singh And Company vs. Municipal Corporation, Korba

Facts

The petitioner, M/s. Ajeet Singh And Company, through its sole proprietor Shri Ajeet Kumar Singh, filed a writ petition before the High Court of Chhattisgarh, Bilaspur. The petitioner's grievance was the inaction of the respondents, Municipal Corporation, Korba and its Commissioner, in refunding the amount of GST collected from the petitioner during the execution of a contract. The contract was awarded prior to the introduction of the GST regime on July 1, 2017. The petitioner relied on a circular issued by the Government of Chhattisgarh mandating refunds for GST paid on contracts executed before July 1, 2017, upon production of certificates of GST payment. Despite repeated approaches, the respondents had not processed the refund. The respondents stated 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 respondent authorities to immediately process the claim of the petitioner for the refund of GST. This processing is to be undertaken after due verification of the facts and the petitioner's entitlement. The Court emphasized that an appropriate decision should be taken keeping in view the State Government's earlier order dated December 21, 2017, and also considering the petitioner's contention that similar refunds have been processed by other government departments like PWD and PMGSY. The respondents were given an outer limit of 90 days from the date of 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 compel the respondents to act on the petitioner's claim.

Key Issues

1. Whether the respondent authorities are obligated to refund the GST collected from the petitioner for a contract executed prior to the GST regime, as per the Government of Chhattisgarh's circular dated December 21, 2017? Petitioner's Contention: The petitioner argued that the respondents are bound by the circular issued by the Government of Chhattisgarh, which mandates the refund of GST paid on contracts executed before July 1, 2017. They highlighted that similar refunds have been granted by other government departments like PWD and PMGSY. The petitioner's primary contention is the inaction of the respondents in processing this refund despite their repeated representations. Respondents' Contention: The respondents submitted that the claim for refund would be decided at the earliest, 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 refunds for pre-GST regime contracts.