M/S Bansal Construction Company Through Its Partner Shri Jitendra Bansal vs. The State Of Madhya Pradesh

Held

The Court, without commenting on the merits of the contentions advanced by the petitioner, directed the Competent Authority to consider and decide the representation of the petitioner. The Court held that the directions contained in a previous order of a Co-ordinate Bench (W.P.No.10282/2021 decided on 23.06.2021) shall apply mutatis mutandis to the facts of the present case. This implies that the Competent Authority is to decide the petitioner's claim for GST refund based on the principles laid down in the cited order, which likely addresses the applicability of GST to pre-GST contracts and the relevant circulars. The ratio decidendi is that representations concerning GST refunds on pre-GST contracts, in light of relevant circulars, should be decided by the Competent Authority following established judicial precedents.

Facts

The petitioner, M/s Bansal Construction Company, filed a writ petition seeking a direction for the decision on their pending representation. The petitioner sought a refund of GST amount recovered after the completion of work. The petitioner contended that GST was not applicable to their contract as the Notice Inviting Tender (NIT) was issued on May 20, 2016, and the work order was issued on October 14, 2016, while the GST Act came into force on July 1, 2017. The petitioner relied on State Government Circulars dated August 5, 2017, and November 14, 2018, which declared that GST would not be applicable to contracts for which NIT was issued prior to July 1, 2017. The respondents, the State of Madhya Pradesh and its various departments, did not oppose the prayer.

Key Issues

1. Whether the petitioner is entitled to a refund of GST amount recovered after the completion of work, considering the dates of NIT and work order in relation to the implementation of the GST Act? 2. Whether the State Government Circulars dated August 5, 2017, and November 14, 2018, are applicable to the petitioner's case? Petitioner's Arguments: The petitioner argued that GST was not applicable to their contract because the NIT was issued on May 20, 2016, and the work order was issued on October 14, 2016, predating the GST Act's effective date of July 1, 2017. They relied on the State Government's Circulars of August 5, 2017, and November 14, 2018, which stipulated that GST would not apply to contracts initiated before July 1, 2017. They sought the benefit of these circulars for a refund of the recovered GST. Revenue's Arguments: The Additional Advocate General for the respondents/State did not oppose the petitioner's prayer.