Facts of the Case

Bikramjit Paul filed a writ petition (WPA 21957 of 2023) before the Calcutta High Court against the State of West Bengal, seeking a direction that the government bear the additional tax liability arising from execution of subsisting government contracts — whether awarded in the pre-GST or post-GST regime — where the applicable Schedule of Rates (SOR) and Bill of Quantities (BOQ) used for inviting bids had not been updated to incorporate GST. The petitioner sought neutralisation of the unforeseen additional tax burden on ongoing contracts awarded before GST's introduction on 01.07.2017, and updating of the State SOR to reflect applicable GST in place of the now-inapplicable West Bengal VAT.

Issues Involved

  1. Whether the State should be directed to consider and neutralise the additional GST burden on government contracts awarded under a pre-GST Schedule of Rates.

Petitioner's Arguments

  • Government contracts awarded before or around the GST rollout continued to be billed under an outdated Schedule of Rates that reflected pre-GST West Bengal VAT rather than the applicable GST, unfairly shifting the additional tax burden onto contractors.
  • The State should update its SOR/BOQ framework to reflect GST and neutralise the unforeseen tax impact on ongoing contracts.

Respondent's Arguments

  • The State's counsel's specific opposing submissions are not separately recorded; the order proceeds on the basis of directing consideration of the petitioner's representation.

Court Order / Findings

  • Justice Md. Nizamuddin disposed of the writ petition by directing the petitioner to file a detailed representation before the Additional Chief Secretary, Finance Department, Government of West Bengal, within four weeks.
  • The Additional Chief Secretary was directed to take a final, reasoned decision within four months of receiving the representation, after consulting other relevant departments and affording the petitioner a hearing, considering judgments of various High Courts relied upon by the petitioner.
  • Until the final decision, no coercive action was to be taken against the petitioner; if no representation was filed within the stipulated time, the protective directions would lapse.

Important Clarification

The Court did not itself decide whether the State is legally obliged to neutralise the GST-transition tax burden on pre-GST government contracts — it directed the Finance Department to take that policy/legal decision after hearing the petitioner. Contractors with similar GST-transition tax burden claims against West Bengal government departments should treat this as a procedural pathway, not as a ruling establishing the State's liability.

Sections Involved

  • Central Goods and Services Tax Act, 2017 and West Bengal Goods and Services Tax Act, 2017 — referenced as the basis of the GST-transition tax burden claim on government works contracts.
  • West Bengal Value Added Tax Act, 2003 — referenced as the pre-GST regime under the outdated Schedule of Rates.

Decision – In Favour of

Disposed of without a decision on merits — the petitioner secured only a time-bound procedure for the Finance Department to decide the GST-transition tax burden claim, with protection from coercive action in the interim; no substantive entitlement was declared.

Case Details

Court: High Court at Calcutta
Case No.: WPA 21957 of 2023
Coram: Justice Md. Nizamuddin
Date of Order: 19.09.2023

Link to Download the Order

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