S And L Infrastructure Through Its Authorized Signatory Saransh Agrawal vs. The State Of Madhya Pradesh

Held

The Court held that the petitioner was entitled to reimbursement of the differential GST amount. It was established that the GST rate was enhanced from 12% to 18% effective January 1, 2022, as per Notification No. 15/2021 CT(R). The Court found that Respondent No. 2, being a government entity, was liable to pay the enhanced GST. The Court rejected the objection regarding the maintainability of the writ petition, stating that no disputed question of facts was involved. Consequently, Respondent No. 2 was directed to pay the difference of GST amount to the petitioner at 6% for the period from January 1, 2022, to September 30, 2022, within three months. If payment was not made within this period, the petitioner would be entitled to interest at 6% per annum from the date of entitlement. The writ petition was disposed of with these directions.

Facts

The petitioner, engaged in construction work, was awarded contracts by Respondent No. 2, a Public Enterprise and Government Entity. The petitioner paid GST on work executed. Initially, GST was levied at 12% until December 31, 2021. Subsequently, vide Notification No. 15/2021 CT(R) dated November 18, 2021, the GST rate was enhanced to 18% effective January 1, 2022. The petitioner's grievance was that Respondent No. 2 continued to pay bills at the 12% rate, while the petitioner was paying 18%. The petitioner sought reimbursement of the extra 6% GST paid from January 1, 2022, to September 30, 2022, totaling Rs. 16,42,488/-. Respondent No. 2 acknowledged the liability but cited a lack of approval from the State Government. The petitioner then approached the High Court.

Key Issues

1. Whether the petitioner is entitled to reimbursement of the differential GST amount paid at 18% instead of 12% for the period January 1, 2022, to September 30, 2022, considering the enhancement of the GST rate by Notification No. 15/2021 CT(R)? Petitioner's arguments: The petitioner contended that the GST rate was legally enhanced to 18% from January 1, 2022, and Respondent No. 2, as a government entity, was liable to pay the enhanced rate. The petitioner had paid the increased GST and sought reimbursement for the extra amount paid due to Respondent No. 2's continued payment at the old rate. The petitioner argued that no disputed question of fact was involved, making a writ petition maintainable. Revenue/State's arguments: Respondents No. 2 & 3 raised objections regarding the maintainability of the writ petition and the availability of an alternative remedy under the Arbitration Act. Respondent No. 4 (State GST Department) confirmed the GST rate enhancement.