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2023 (10) TMI 1151 - HC - GSTLevy of GST - works contract executed and completed after 1st July, 2017 wherein the contracts were awarded in the pre-GST regime or post-GST regime - HELD THAT - It appears the respondent authorities concerned have to bear the additional tax liability for execution of subsisting Government contract either awarded to the petitioner during pre-GST regime or in post-GST regime without updating the Schedule of Rates (SOR) incorporating the applicable GST while preparing Bill for payment. Considering the submissions of the parties, this writ petition is disposed of by giving liberty to the petitioner to file appropriate representations stating all the facts and provision as referred in preceding paragraph of this judgment, before the Additional Chief Secretary, Finance Department, Government of West Bengal within four weeks from date. On receipt of such representations the Additional Chief Secretary, Finance Department shall take a final decision within four months from the date of receipt of such representations after consulting with all other relevant departments concerned. Petition disposed off.
Issues involved:
The issues involved in this case include liability of GST on works contracts executed before and after the GST regime, challenge to show cause notices under the Central Goods and Services Tax Act, 2017 and the West Bengal Goods and Services Tax Act, 2017, suppression of taxable turnover, and the responsibility of government contractees to pay tax and interest under the GST Act. Liability of GST on Works Contracts: The petitioner filed a writ petition seeking direction for the payment of GST liability on works contracts completed after 1st July, 2017, regardless of whether the contracts were awarded before or after the GST regime. The petitioner argued that it was impossible to include the component of GST in the contract value awarded prior to the GST legislation coming into force. The petitioner also challenged the show cause notices issued by the GST authorities for the period 2017-2018 & 2018-2019. Suppression of Taxable Turnover: The GST authorities issued notices to the petitioner alleging suppression of taxable turnover, leading to non-payment or evasion of GST during the financial years 2017-2018 & 2018-2019. The notices highlighted discrepancies between GSTR-3B and Income Tax Form 26AS, indicating non-payment of GST. Responsibility of Government Contractees: The petitioner contended that government contractees are liable to pay tax and interest under the GST Act. The petitioner cited previous court decisions to support this argument, emphasizing that the government contractees should not evade their responsibility to pay applicable taxes. Court's Decision: After hearing the submissions, the court disposed of the writ petition by allowing the petitioner 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 after considering all relevant facts and provisions. No coercive action was to be taken against the petitioner until a final decision was made. The court emphasized that the decision should be based on law and supported by reasoning, taking into account all relevant judgments referenced by the petitioner. Conclusion: The court's judgment addressed the issues of GST liability on works contracts, suppression of taxable turnover, and the responsibility of government contractees to pay taxes. The court provided a mechanism for the petitioner to present representations and directed the Additional Chief Secretary to make a final decision within a specified timeframe, ensuring fairness and adherence to legal principles in resolving the dispute.
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