Facts of the Case

The petitioner, M/S Myc Infra Pvt. Ltd., a company engaged in infrastructure projects with a pan-India presence, including works for the Airport Authority of India, undertook road construction work under the PMGSY (Pradhan Mantri Gram Sadak Yojana) scheme for respondents no.4 and 5. The petitioner filed this writ petition under Article 226 seeking a mandamus directing respondents no.4 and 5 to pay Rs.1,15,91,455/- along with interest, claimed to be due towards Goods and Service Tax over and above the value of work performed, and seeking consideration of its representations dated 20.12.2020 and 16.09.2021. During the pendency of the petition, on instructions produced pursuant to the Court's orders dated 02.03.2022 and 11.04.2022, it emerged that Rs.92,54,844/- had already been paid to the petitioner, a fact not disputed by the petitioner. The petitioner filed a supplementary affidavit claiming that further amounts remained unpaid under the head of GST.

Issues Involved

  1. Whether the writ court should itself adjudicate the disputed quantum of GST reimbursement payable to the contractor under the works contract.
  2. Whether the dispute is more appropriately resolved through the contractual dispute redressal mechanism prescribed under Clause 24 of the Standard Bidding Document for PMGSY.

Petitioner's Arguments

  • The petitioner is entitled to Rs.1,15,91,455/- along with interest under the head of GST, payable by respondents no.4 and 5 over and above the value of work performed.
  • Further amounts remain unpaid under the head of GST, as detailed in a supplementary affidavit filed at the hearing.
  • The petitioner had already represented the matter to respondents no.4 and 5 by way of a representation dated 16.09.2021.

Respondent's Arguments

  • Respondents no.4 and 5 relied on Clause 24 of the Standard Bidding Document for PMGSY, contending that the factual dispute raised by the petitioner falls within the jurisdiction of the Empowered Standing Committee, which decides all disputes or differences under the contract, including issues relating to payment of GST.
  • On instructions, it was submitted that the petitioner may prefer its claim before the Empowered Standing Committee with full factual details and supporting documents, which would examine and decide the claim expeditiously within a court-stipulated timeframe.

Court Order/Findings

  • The Court noted that Rs.92,54,844/- had already been paid to the petitioner, undisputedly, leaving only the balance claim in contest.
  • Considering the rival submissions, the Court declined to adjudicate the disputed quantum itself and instead disposed of the petition with directions relegating the parties to the contractual dispute redressal mechanism.
  • The petitioner was directed to file a representation/claim before the Empowered Standing Committee under Clause 24 of the Standard Bidding Document for PMGSY, with supporting documents, within 10 days.
  • The Empowered Standing Committee was directed to decide the petitioner's claim within three months from production of a certified copy of the order along with the claim.
  • The Court clarified that its order was not to be construed as an adjudication of the petitioner's claim on merits, and the Committee was to decide independently, uninfluenced by any of the Court's observations.

Important Clarification

  • Where a works contract, such as one governed by the Standard Bidding Document for PMGSY, itself provides a dispute redressal mechanism for disputes including payment of GST, the writ court may decline to adjudicate the disputed quantum and instead direct the parties to that contractual forum.
  • A disposal on this basis is procedural, not a decision on the merits of the underlying GST reimbursement claim, and does not bind the forum that will actually decide the claim.

Sections Involved

  • Article 226 of the Constitution of India – invoked for the writ seeking mandamus for payment of GST reimbursement.
  • Clause 24 of the Standard Bidding Document for PMGSY – the contractual Dispute Redressal System under which the Empowered Standing Committee decides disputes, including on GST payment, between the contractor and the implementing authority. The extracted order does not cite any specific provision of the CGST/SGST Act in relation to the dispute.

Decision – In Favour of

Disposed of with directions; the Court did not decide the disputed GST reimbursement claim on merits and expressly said so. The matter was relegated to the Empowered Standing Committee under the contract's dispute redressal clause, so the outcome cannot be characterised as a clean win for either the contractor-petitioner or the respondent authorities — it is a procedural disposal pending decision by the contractual forum.

Related Case Laws

No related case laws are available on this site at present for cross-reference on this specific point.

Case Details

  • Court: Allahabad High Court (Court No.40)
  • Case No.: WRIT-C No.3753 of 2022
  • Coram: Hon'ble Vivek Kumar Birla, J. and Hon'ble Vikas Budhwar, J.
  • Date of Order: 25.04.2022

Link to Download the Order

Download the full judgment (PDF)

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