The Court orders respondent authorities to evaluate GST-related representations from Shri Jinaraj and Co within six weeks.
In a significant ruling, the Karnataka High Court's Dharwad Bench has directed the competent authorities to consider and decide upon GST payment claims submitted by Shri Jinaraj and Co, a registered partnership firm and Class-I Civil Contractor. The petitioner sought legal recourse to compel the Executive Engineer, Project Division (PMGSY), Karwar, and other respondent authorities to process their representations regarding GST payments for road construction works executed between 2018 and 2023.
Presiding Judge Mr. Sachin Shankar Magadum underscored the necessity for the respondent authorities to examine the representations, which include claims for substantial GST amounts totaling over ?2.99 crore. The court emphasized that once a service provider issues an invoice incorporating the GST component, the service recipient bears the responsibility to discharge the GST liability as per the law.
The petitioner argued that despite fulfilling their contractual obligations and raising invoices inclusive of the 12% GST component, the authorities failed to address their representations for payment. The respondents, however, contended that the tender rates quoted by the petitioner included all applicable taxes, including GST.
The court ruled that the authorities must provide a clear breakdown of the payments already made, indicating the GST component. This will require a thorough examination of individual bills, invoices, and tender conditions. The Court refrained from making any determination regarding the merits of the petitioner's claim for GST payments, leaving the matter to the respondent authorities to decide.
The High Court's order mandates that the representations must be independently evaluated by the authorities within six weeks, with the decision communicated to the petitioner. This directive aims to ensure that the petitioner receives an efficacious remedy and that the authorities fulfill their obligation to address legitimate claims in accordance with administrative law principles.
Bottom Line:
GST liability - Service recipient is liable to bear the applicable GST component, notwithstanding the statutory obligation of depositing the tax with the GST Department by the contractor/service provider.
Statutory provision(s): Goods and Services Tax (GST), Administrative Law
