Facts of the Case

Prasanna Kumar Mohanty challenged a demand raised against him based on payments received in the GST regime for works that had actually been executed in the earlier VAT regime, contending that the Commissioner of Commercial Taxes' own Circular No.14235/CT dated 22.09.2017, clarifying the treatment of works contracts transitioning from VAT to GST, expressly provided that no GST liability arose on such payments.

Issues Involved

  1. Whether the demand raised for GST on payments received for VAT-regime work was contrary to the Commissioner's Circular No.14235/CT dated 22.09.2017.

Petitioner's Arguments

  • The demand was illegal and arbitrary since the department's own circular clarified that no GST liability arose on payments received in the GST regime for works actually executed under the VAT regime.

Respondent's Arguments

  • Not separately recorded; the petitioner opted to withdraw with liberty rather than press the challenge before the High Court.

Court Order / Findings

  • On the petitioner's own submission that an alternative remedy was available, and that he wished to withdraw the writ petition with liberty to approach the appropriate forum, the Court permitted withdrawal and disposed of the petition as withdrawn, granting that liberty.

Important Clarification

The Court did not decide whether Circular No.14235/CT actually exempted the petitioner's transaction from GST -- that substantive question remains open and must now be pursued before the appropriate forum (typically the assessing/appellate GST authority) that the petitioner was given liberty to approach.

Sections Involved

  • Odisha Goods and Services Tax Act, 2017 / transition provisions for works contracts moving from VAT to GST
  • Circular No. 14235/CT dated 22.09.2017 (Commissioner of Commercial Taxes, Odisha)

Decision – In Favour of

Neither party on merits – the petition was disposed of as withdrawn, without a decision on merits, granting liberty to pursue the alternative remedy.

Case Details

Court: High Court of Orissa at Cuttack
Case Number: W.P.(C) No. 5232 of 2023
Coram: Dr. Justice B.R. Sarangi and Justice Murahari Sri Raman
Date of Order: 22 August 2023

Link to Download the Order

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