Maneesh Pipes PVT. LTD. vs. State Of Chhattisgarh

Held

The Court held that the writ petition is maintainable at this juncture. The Court reasoned that since the respondents had not yet denied or disputed the petitioner's claim for refund by passing any formal order or rejecting the claim, the stage for invoking the arbitration clause had not yet arisen. The petitioner's claim was still pending consideration. The Court acknowledged the petitioner's reliance on the circulars dated October 10, 2018, and December 21, 2017. Consequently, the Court directed respondents No. 2 to 5 to take a decision on the petitioner's claim/representation for the refund of GST at the earliest, preferably within 60 days from the receipt of the order. The petitioner was granted liberty to pursue appropriate remedies based on the decision of the respondents. No specific finding was made on the entitlement to the refund itself, as the matter was remanded for decision by the authorities.

Facts

The petitioner, Maneesh Pipes Pvt. Ltd., was awarded a contract for a water supply scheme prior to July 1, 2017. Upon the implementation of GST on July 1, 2017, the petitioner was initially made to pay 18% GST on the contract, which was later reduced to 12%. The petitioner sought a refund of the GST paid, citing circulars from the Chhattisgarh Government dated October 10, 2018, and December 21, 2017, which allegedly addressed refunds of tax levied on account of subsequent tax impositions. The petitioner had repeatedly approached the respondent authorities but had not received a response. The State counsel argued that the contract contained an arbitration clause, making the writ petition unsustainable.

Key Issues

1. Whether the writ petition is maintainable in light of the arbitration clause present in the contract between the petitioner and the respondents? 2. Whether the petitioner is entitled to a refund of GST paid on the contract awarded prior to the GST regime, based on the circulars issued by the State Government? The petitioner contended that the writ petition is maintainable because the respondents have not yet disputed or rejected the petitioner's claim for refund, and therefore, the stage for invoking the arbitration clause has not arisen. The petitioner relied on circulars dated October 10, 2018, and December 21, 2017, to support their claim for refund. The respondents, through the State counsel, argued that the existence of an arbitration clause in the contract bars the petitioner from approaching the High Court through a writ petition and that the petitioner should avail the arbitration remedy.