M/S.Tharun Construction And Co vs. The Superintending Engineer

Facts

The petitioner, M/s. Tharun Construction and Co., a construction company, entered into a works contract agreement with the respondent, the Superintending Engineer, Public Works Department, Government of Tamil Nadu, in 2020 for irrigation infrastructure. The GST rate applicable to such composite supply of works contract was 12% until July 18, 2022, as per Notification No. 11/2017 and Notification No. 20/2017. However, Notification No. 3/2022 increased the GST rate to 18% effective from July 13, 2022, while the petitioner's agreement was still subsisting. The petitioner claims to have paid 18% GST but was reimbursed only at 12%. Consequently, the petitioner submitted a representation dated December 27, 2022, to the respondent seeking payment of the differential GST amount.

Held

The Court held that the respondent is directed to consider the petitioner's representation dated December 27, 2022, concerning the payment of the differential rate of GST. The respondent is to take into account the relevant notifications, specifically Notification No. 11/2017, Notification No. 20/2017, and Notification No. 03/2022 (Central Tax (Rate)), when deciding the matter. The Court further directed that this consideration should be completed within a period of six weeks from the date of receipt of a copy of the order. The respondent was also advised that if necessary, a personal hearing could be granted to the petitioner. The Court did not decide on the merits of the petitioner's claim for differential GST payment but focused on ensuring the representation is duly considered by the respondent within a stipulated timeframe.

Key Issues

1. Whether the respondent is obligated to consider the petitioner's representation dated 27.12.2022 regarding the differential GST payment, and if so, within what timeframe? (Question of procedure and administrative action). Petitioner's arguments: The petitioner contended that a representation was submitted seeking reimbursement of the differential GST amount due to a change in the applicable rate from 12% to 18% during the subsistence of their works contract. They relied on Notification No. 11/2017, Notification No. 20/2017, and Notification No. 03/2022 (Central Tax (Rate)) to support their claim for the differential rate. Respondent's arguments: The learned Special Government Pleader for the respondent acceded to the position that the representation was received and would be considered, implying an acknowledgment of the need for consideration but not necessarily an admission of the petitioner's claim on merits.