M/S Gordhandas Gobindram A Company Incorporated Under The Companies Act vs. State Of Chhattisgarh

Held

The Court held that the writ petition should be disposed of by permitting the petitioner to approach respondents No. 2 to 5 with a fresh claim and necessary proof of the additional tax liability incurred due to the introduction of GST. This approach is to be made in terms of the State Government's order dated October 10, 2018. The Court reasoned that this aligns with the State Government's policy and the precedent set in the case of M/s D.A.Enterprises. The petitioner was directed to submit the necessary proof within one week. The respondents-authorities were then directed to scrutinize the claim and take a decision within 90 days from the receipt of the claim, keeping in mind the State Government's order dated October 10, 2018. The ratio decidendi is that the State's policy decision for reimbursement of additional GST on pre-GST contracts must be followed, and the High Court will ensure its implementation by directing the concerned authorities to consider such claims based on submitted proof and precedent.

Facts

The petitioner, M/s Gordhandas Gobindram, filed a writ petition challenging the additional tax liability incurred due to the introduction of GST law from July 1, 2017. This liability arose from contracts awarded prior to the GST regime. The petitioner sought reimbursement of this additional tax liability, relying on a policy decision by the respondent-Public Works Department dated October 10, 2018, which mandated reimbursement for contractors in such situations. The petitioner also cited a previous High Court order in a similar case, M/s D.A.Enterprises v. State of Chhattisgarh and others, which allowed a writ petition under identical circumstances. The respondents, represented by the State Counsel, agreed to consider the petitioner's claim if a fresh claim with all relevant proof of additional tax liability was furnished.

Key Issues

1. Whether the petitioner is entitled to reimbursement of additional GST liability incurred on contracts awarded prior to July 1, 2017, in light of the State Government's policy decision dated October 10, 2018? (Question of law) 2. Whether the present writ petition should be allowed based on the precedent set by this Court in M/s D.A.Enterprises v. State of Chhattisgarh and others (WPT No.94 of 2020)? (Question of law) Petitioner's contentions: The petitioner argued that they are entitled to reimbursement of the additional tax liability incurred due to GST on pre-GST contracts, citing the State Government's policy decision dated October 10, 2018. They further relied on the High Court's decision in M/s D.A.Enterprises, which dealt with identical facts and granted relief. Respondents' contentions: The State Counsel submitted that the petitioner's claim would be considered in terms of the State Government's order dated October 10, 2018, provided the petitioner furnishes a fresh claim along with all relevant proof of the additional tax liability incurred.