Facts of the Case

The petitioner, M/S S. Kumar Enterprises, through its proprietor Girja Yadav, approached the Lucknow Bench of the Allahabad High Court by way of Writ Tax No. 217 of 2023 against the State of U.P., through the Principal Secretary, Public Works Department, Lucknow, and others. The petitioner's grievance was that the bill amount affirmed in its favour for works executed had already been cleared by the respondent department, but the GST amount deducted at source from that bill under the GST TDS mechanism had neither been remitted nor had the corresponding TDS certificate been issued to the petitioner, leaving it unable to claim the credit of tax already deducted. The matter was heard on 08.11.2023 by a Division Bench of Justice Vivek Chaudhary and Justice Manish Kumar, Court No. 3.

Issues Involved

  1. Whether the petitioner-contractor was entitled to release of the GST TDS amount deducted from its bill by the PWD, and to issuance of the corresponding TDS certificate.
  2. Whether, in the absence of adjudicated facts, the appropriate course was a direction to the executing department to consider a detailed representation rather than adjudication by the Writ Court.

Petitioner's Arguments

  • The petitioner submitted that although the bill itself had been cleared, the GST amount deducted from it was neither cleared to the credit of the petitioner nor was a certificate for the same provided, causing continuing hardship in availing credit.
  • Counsel submitted that the petitioner's grievance would be substantially met if a detailed representation raising the issue was considered and decided by the department in a time-bound manner, obviating the need for the Court to go into the merits itself.

Respondent's Arguments

  • Learned Standing Counsel for the State had no objection to the course proposed by the petitioner, namely that the grievance be routed through a representation to the Engineer-in-Chief, PWD, for consideration and a reasoned decision.

Court Order/Findings

  • The Court permitted the petitioner to make a fresh, detailed representation to Respondent No. 2, the Engineer-in-Chief, Public Works Department, Lucknow, raising all grievances and annexing a copy of the writ petition with supporting documents, within two weeks.
  • The Court directed that on receipt of such representation, Respondent No. 2 shall consider and decide it in accordance with law by a reasoned and speaking order within six weeks of a certified copy of the order and representation being placed before him.
  • It was made clear that the Court had not applied itself to the merits of the case, and all questions were left open to be decided by the competent authority in accordance with law; the petition was disposed of on these directions.

Important Clarification

Where a government department deducts GST TDS from a contractor's bill but fails to remit it or issue the statutory TDS certificate, the High Court's usual first-line remedy is not to adjudicate entitlement itself but to direct the deducting department to consider a detailed, time-bound representation and pass a reasoned, speaking order — leaving all substantive contentions open for the department (and, if unresolved, a fresh round of litigation) to decide.

Sections Involved

  • Section 51, Central Goods and Services Tax Act, 2017 – mandates specified persons, including government departments, to deduct tax at source (GST TDS) on payments to suppliers under works contracts and similar arrangements.
  • GST TDS certificate mechanism (Form GSTR-7A) under the CGST framework – requires the deductor to issue a certificate to the deductee reflecting the tax deducted, enabling the deductee to claim credit of the amount deducted.

Decision – In Favour of

This is a directions-only disposal with the merits expressly left open. Honestly framed, it is disposed of with directions, in part in favour of the Assessee — the petitioner secured a concrete, time-bound mechanism for its GST TDS grievance to be examined and answered by a reasoned order, but the Court did not itself find that the amount was wrongly withheld or that the certificate was wrongly withheld.

Related Case Laws

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

Case Details

  • Court: High Court of Judicature at Allahabad, Lucknow Bench
  • Case No.: Writ Tax No. 217 of 2023
  • CNR: Not available on record
  • Coram: Justice Vivek Chaudhary and Justice Manish Kumar
  • Decision Date: 08 November 2023
  • Disposal Nature: Disposed of with directions

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