2023 (9) TMI 1123 - HC - GST

Levy of additional tax liability - execution of subsisting Government contracts either awarded in the pre-GST regime or in the post GST regime without updating the Schedule of Rates (SOR) - seeking to neutralize the impact of unforeseen additional tax burden on Government contracts since the introduction of GST - HELD THAT - These writ petitions are disposed of by giving liberty to the petitioners to file appropriate representations, before the Additional Chief Secretary, Finance Department, Government of West Bengal within four weeks from date. Petition disposed off.

Summary

Issues involved:
The issues involved in the judgment include seeking relief for additional tax liability in government contracts due to GST implementation and the updating of Schedule of Rates (SOR) to incorporate applicable GST.

Relief for Additional Tax Liability in Government Contracts:
The writ petition was filed to direct the concerned authority to bear the additional tax liability for executing government contracts awarded before and after the GST regime without updating the Schedule of Rates (SOR) to include applicable GST in the Bill of Quantities (BOQ) for inviting bids. The petitioners also sought relief to neutralize the impact of unforeseen additional tax burden on ongoing contracts awarded before the introduction of GST, and to update the State SOR with applicable GST instead of the inapplicable West Bengal VAT going forward.

Disposition of Writ Petitions:
The writ petitions were disposed of by allowing the petitioners to file representations before the Additional Chief Secretary, Finance Department, Government of West Bengal within four weeks. The Additional Chief Secretary was directed to make a final decision within four months of receiving the representations after consulting with all relevant departments. It was emphasized that no coercive action should be taken against the petitioners until the final decision is made. Failure to submit representations within the specified time would render the order ineffective.

Decision-making Process:
The Additional Chief Secretary was instructed to act in accordance with the law, pass a reasoned order based on merit, and consider all relevant judgments from different High Courts that the petitioners intend to rely on while deciding on the representations filed by the petitioners. The final decision-making process was outlined to ensure fairness and thorough consideration of all aspects before reaching a conclusion.

Conclusion:
The writ petition, numbered WPA 5356 of 2023, was disposed of with the mentioned observations and directions, providing the petitioners with the opportunity to address their concerns regarding additional tax liability in government contracts due to the GST implementation and the need for updating the Schedule of Rates to reflect the applicable GST.