Shri Jee Constructions Thruogh Its Power Of Attorney Holder Mukesh Kumar Gupta vs. The State Of Madhya Pradesh

Held

The Court held that the petitioner could not be relegated to the Dispute Resolution Forum under the agreement, as no disputed question of facts was involved. The Court noted that respondent No. 4, the State GST Department, confirmed the enhancement of GST rates from 12% to 18% and that respondent No. 2, being a Government Entity, was liable to pay the enhanced rate. Consequently, the Court directed respondent No. 2 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 of receiving a certified copy of the order. 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 to this extent.

Facts

The petitioner, Shri Jee Constructions, engaged in construction work, was awarded contracts by respondent No. 2, a Public Enterprise. The petitioner paid GST at 12% on work executed until December 31, 2021. Subsequently, GST rates were enhanced to 18% effective January 1, 2022, through Notification No. 15/2021 CT(R). The petitioner's grievance was that respondent No. 2 continued to pay running bills at the old 12% rate, forcing the petitioner to bear the additional 6% GST. The petitioner represented this issue, and respondent No. 2, by letter dated September 26, 2022, acknowledged the liability to pay the additional 6% GST from January 1, 2022, but stated that approval from the State Government was pending. The petitioner then filed a writ petition seeking reimbursement of the extra GST paid.

Key Issues

1. Whether the respondents are liable to reimburse the petitioner for the additional GST paid at 6% on invoices issued from January 1, 2022, to September 30, 2022? (Question of law). Petitioner's contention: The petitioner argued that the GST rate was enhanced to 18% from January 1, 2022, and respondent No. 2, a Government Entity, is liable to pay this enhanced rate on the work executed. They relied on Notification No. 15/2021 CT(R) and the acknowledgment of liability by respondent No. 2 in its letter dated September 26, 2022. The petitioner also contended that a writ petition is maintainable as no disputed question of fact is involved. Revenue/State's contention: Respondent No. 2 and 3 raised an objection 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 to 18% and stated that respondent No. 2, as a Government Entity, is liable to pay it.