Pradeep Kumar Wadhwani vs. The State Of Madhya Pradesh

Held

The Court held that no disputed question of facts were involved in the case, thus the petitioner could not be relegated to the Dispute Resolution Forum under the agreement. The Court noted that the GST rate was enhanced from 12% to 18% effective January 1, 2022, and this enhanced rate was liable to be paid by Respondent No. 2, a Government Entity. Following the parity with a previous order of the Division Bench dated December 12, 2024, in WP No. 39378 of 2024, the Court directed Respondent No. 2 to pay the difference of GST amount to the petitioner at the rate of 6% for the period from January 1, 2022, to September 30, 2022, within three months of receiving a certified copy of the order. The Court further stipulated that 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, Pradeep Kumar Wadhwani, filed a writ petition seeking a mandamus to direct the respondents to release the admitted liability of the difference in GST amount of Rs. 15,69,554/- along with 24% interest. The petitioner, engaged in construction work, was awarded contracts by Respondent No. 2, a Government Entity. The GST rate applicable to the petitioner's services was enhanced from 12% to 18% effective January 1, 2022. However, Respondent No. 2 continued to pay GST at the old rate of 12% on running bills, forcing the petitioner to pay the enhanced 18% GST. Respondent No. 2, by letter dated September 26, 2022, accepted the liability to pay the additional 6% GST from January 1, 2022, but cited pending approval from the State Government. The State GST Department confirmed the enhanced rate. The petitioner approached the High Court as the arrears were not paid.

Key Issues

1. Whether the petitioner is entitled to a writ of mandamus directing the respondents to release the admitted difference in GST amount of Rs. 15,69,554/- along with interest, considering the enhancement of GST rate from 12% to 18% effective January 1, 2022, and the admitted liability of Respondent No. 2? Petitioner's Contention: The petitioner argued that Respondent No. 2, a Government Entity, had accepted the liability to pay the additional 6% GST from January 1, 2022, and that the State GST Department also confirmed the enhanced rate. The petitioner sought a direction for payment of the admitted difference and interest, relying on a previous order of the Division Bench of the same High Court dated December 12, 2024, in WP No. 39378 of 2024, which dealt with a similar grievance. Revenue/State's Contention: Respondents No. 2 & 3 raised objections regarding the maintainability of the writ petition and the availability of an alternative remedy under the Arbitration Act. The State GST Department (Respondent No. 4) confirmed the enhanced GST rate.