Facts of the Case

The petitioner, West India Construction Company, a partnership firm through its partner Ashok Kumar Jain, is engaged in works contracts and approached the High Court of Chhattisgarh, Bilaspur, seeking a direction to the Commissioner and Executive Engineer, Municipal Corporation Bhilai Charoda, District Durg, to decide its representation dated 13.05.2023 for refund of excess GST paid on a works contract on account of the change in GST rate on works contract services from 12% to 18% with effect from 18.07.2022. The relief sought in the writ petition was limited to a direction that the representation be considered and decided, rather than a determination of the petitioner's entitlement to refund. The matter was heard by a Single Judge.

Issues Involved

  1. Whether the Municipal Corporation should be directed to decide the petitioner's representation seeking refund of excess GST arising from the mid-contract rate revision.
  2. Whether the stand already taken by the State Government in other departments, such as PWD, Water Resources and Irrigation, for refund of similar excess GST should guide the Corporation's decision on the petitioner's claim.

Petitioner's Arguments

  • The State Government itself, in departments such as PWD, Water Resources and Irrigation, had already taken a decision to refund the excess GST that arose on account of the deviation in the GST rate payable on works contracts.
  • There was no reason why the Municipal Corporation Bhilai Charoda should not adopt a similar stand and consider the petitioner's claim for refund of excess GST on the same basis.
  • The representation dated 13.05.2023 had already been submitted to the respondent authorities but remained undecided.

Respondent's Arguments

  • The State's counsel accepted that the representation had to be considered by the Municipal Corporation authorities.
  • Given the limited nature of the relief sought — merely a direction to consider the representation — the State raised no objection to the writ petition being allowed to that extent.

Court Order/Findings

  • Given the limited relief sought and the State's non-objection, the Court disposed of the writ petition directing the Municipal Corporation authorities to consider the petitioner's representation dated 13.05.2023 within an outer limit of 90 days from receipt of the order.
  • While deciding, the respondent authorities were directed to take into consideration similar decisions already taken by the State Government in respect of contracts executed by contractors with other departments, such as PWD, Irrigation and Water Resources.
  • No finding was recorded on the petitioner's actual entitlement to refund; that determination was left entirely to the Municipal Corporation.

Important Clarification

Where the State Government has already extended relief for excess GST paid on works contracts owing to the mid-contract rate revision from 12% to 18%, to contractors of certain departments, a contractor working under a different authority — such as a Municipal Corporation — can obtain a writ direction compelling that authority to at least consider a similarly framed representation, guided by the State's own precedent on the point, even though the writ court itself stops short of deciding the entitlement to refund.

Sections Involved

  • GST rate notification effecting the change on works contract services from 12% to 18% w.e.f. 18.07.2022 — issued under the CGST/SGST Acts, 2017, governing the tax rate applicable to ongoing works contracts.
  • Article 226, Constitution of India — writ jurisdiction invoked to direct consideration of an administrative representation.

Decision – In Favour of

This is a disposal with directions rather than a decision on merits. It is partially in favour of the Assessee to the extent the Court has compelled the Municipal Corporation to consider the refund representation within a fixed time frame, guided by the State's own practice for other departments; however, no finding was made on whether the petitioner is actually entitled to the refund, leaving that determination to the Corporation.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Chhattisgarh, Bilaspur
  • Case No.: WPC No. 5043 of 2023
  • CNR: Not available
  • Coram: Justice Naresh Kumar Chandravanshi
  • Decision Date: 05.12.2023
  • Disposal Nature: Disposed of with directions

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