Facts of the Case

The petitioner, M/s Dhaneshwar Nath Construction, was awarded a NABARD-funded road construction and five-year maintenance contract ("Akauna Path to Yogapur Path in Punpun Block") under Agreement No. 12/SBD/2019-20 by the Rural Works Department, Government of Bihar. The petitioner claimed that GST, Seigniorage Charge and Labour Cess were not included in the original estimate and Bill of Quantity for the work, and sought a direction to the department to add these components to the estimate/agreement, and to refund or reimburse amounts already deducted from its Running Account (R/A) bills towards Seigniorage Charge, Labour Cess, and GST.

Issues Involved

  1. Whether the department was obliged to include GST, Seigniorage Charge, and Labour Cess in the contract estimate, and to reimburse amounts already deducted from the contractor's bills on these accounts.

Petitioner's Arguments

  • GST, Seigniorage Charge and Labour Cess, for which the petitioner remained liable, were not factored into the original estimate and Bill of Quantity, and the department was obliged to reimburse amounts deducted from the R/A bills on these accounts.

Respondent's Arguments

  • No detailed counter-submissions of the Rural Works Department are recorded in the judgment — the Court disposed of the matter procedurally without calling for a merits-based reply.

Court Order / Findings

  • The Division Bench (Chief Justice) declined to examine the merits of the contractual/reimbursement dispute in writ jurisdiction.
  • The petitioner was directed to file a representation before the Chief Engineer-I, Rural Works Department, within four weeks, which the authority was directed to dispose of by a reasoned, speaking order within four months, after giving a hearing and an opportunity to place all relevant material.
  • The Court expressly clarified: "We have not expressed any opinion on merits. All issues are left open," and reserved liberty to the petitioner to pursue any other available remedy.

Important Clarification

This order settles nothing on whether a contractor is entitled to reimbursement of GST, Seigniorage Charge, or Labour Cess deducted from bills where these were not built into the original contract estimate — that question remains entirely open, to be decided afresh by the department on the petitioner's representation, subject to further legal recourse if the outcome is unsatisfactory.

Sections Involved

  • Central Goods and Services Tax Act, 2017 / Bihar Goods and Services Tax Act, 2017 — referenced only as the subject-matter of the reimbursement claim
  • Constitution of India — Article 226

Decision – In Favour of

Disposed of without a decision on merits — all issues expressly left open, with a direction to file a fresh representation before the department.

Case Details

Court: High Court of Judicature at Patna
Case No.: Civil Writ Jurisdiction Case No. 17595 of 2022
Coram: Hon'ble the Chief Justice (Sanjay Karol, CJ) and Hon'ble Mr. Justice Partha Sarthy
Date of Judgment: 30 January 2023

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