Facts of the Case

The petitioner, Sri T.T. Venkataramana Reddy, approached the High Court of Karnataka seeking a direction to the Bruhat Bangalore Mahanagara Palike (BBMP) and its concerned Executive Engineer to reimburse a Goods and Services Tax amount of ₹1,19,53,320.

The petitioner also sought payment of interest at 18% per annum on the GST dues, referring to the statutory interest rate chargeable under Section 50 of the CGST Act, 2017.

The material placed before the Court disclosed that the petitioner had submitted:

  • a letter dated 10 January 2019, produced as Annexure-H; and
  • a letter dated 9 November 2021, produced as Annexure-J.

Despite these representations, the respondents had not taken steps to consider the petitioner’s claim for reimbursement of the GST amount together with applicable interest. Consequently, the petitioner invoked the writ jurisdiction of the High Court under Articles 226 and 227 of the Constitution of India.

Issues Involved

The principal issues arising in the writ petition were:

  1. Whether the respondents were required to consider and decide the petitioner’s pending claim for reimbursement of GST amounting to ₹1,19,53,320.
  2. Whether the petitioner’s claim for applicable interest on the GST amount, including the claim at 18% per annum with reference to Section 50 of the CGST Act, 2017, was required to be considered by the respondents.
  3. Whether the continued non-consideration of the petitioner’s representations dated 10 January 2019 and 9 November 2021 justified issuance of appropriate directions in writ jurisdiction.
  4. Whether the respondents should be directed to pass an appropriate order or take an appropriate decision on the petitioner’s representations within a fixed time period.

Petitioner’s Arguments

The petitioner’s case was that despite submission of the letters and representations dated 10 January 2019 and 9 November 2021, the respondents had failed to take steps to consider the claim for reimbursement of the GST amount.

The petitioner sought reimbursement of ₹1,19,53,320 towards GST and further claimed applicable interest. In the relief clause, the petitioner specifically sought interest at 18% per annum, referring to the statutory interest rate chargeable under Section 50 of the CGST Act, 2017.

Accordingly, the petitioner requested the High Court to issue an appropriate writ, including a writ in the nature of mandamus, directing the respondents to reimburse the GST amount and pay interest on the GST dues.

Respondents’ Arguments

The learned counsel appearing for the respondents submitted that if reasonable time was granted, the respondents would:

  • consider the petitioner’s claim;
  • take an appropriate decision; and
  • pass an appropriate order in accordance with law.

Thus, the respondents expressed willingness to consider the petitioner’s grievance and pending claim within a reasonable period.

Court Order / Findings

The High Court observed that the material on record disclosed that despite submission of the petitioner’s letters dated 10 January 2019 and 9 November 2021, the respondents had not taken steps to consider the petitioner’s claim for reimbursement of the GST amount together with applicable interest.

Taking into account the circumstances of the case and the submission made on behalf of the respondents, the High Court considered it appropriate to direct the respondents to address the petitioner’s grievance.

Accordingly, the Court directed the respondents to:

  • consider the representations/letters at Annexure-H and Annexure-J, dated 10 January 2019 and 9 November 2021;
  • bear in mind the documents produced by the petitioner in the writ petition;
  • pass an appropriate order or take an appropriate decision in accordance with law; and
  • complete the exercise within four weeks from the date of receipt of a copy of the Court’s order.

The Court further permitted the petitioner to appear before the BBMP Commissioner on 3 November 2022.

The petitioner was granted liberty to produce:

  • additional documents;
  • pleadings; and
  • other relevant material

before the BBMP Commissioner.

The BBMP Commissioner was directed to consider the same and pass an appropriate order or take an appropriate decision within four weeks from 3 November 2022.

Important Clarification

The High Court did not itself adjudicate or finally allow the substantive claim for reimbursement of ₹1,19,53,320, nor did it finally award interest at 18% per annum under Section 50 of the CGST Act, 2017.

The operative direction was for the respondents to consider the petitioner’s pending representations and supporting documents and thereafter pass an appropriate order or take an appropriate decision in accordance with law within the prescribed period.

Therefore, the decision is significant as a case concerning non-consideration of a GST reimbursement claim by a public authority and judicial direction for time-bound disposal of pending representations, rather than a final determination by the High Court that the GST reimbursement or Section 50 interest was automatically payable.

Sections and Constitutional Provisions Involved

  • Section 50 of the Central Goods and Services Tax Act, 2017 (CGST Act) – Interest on delayed payment of tax; relied upon by the petitioner while claiming interest at 18% per annum on the GST dues.
  • Articles 226 and 227 of the Constitution of India – Writ jurisdiction of the High Court invoked for appropriate directions against the respondents.
  • Writ of Mandamus – Sought for directing the respondents to reimburse the GST amount and pay interest.

Link to download the order -

https://mytaxexpert.co.in/uploads/1783505637_1538compressed.pdf

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