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2023 DIGILAW 384 (ALL)

Bhardwaj Constructions v. State of U. P.

2023-02-07

MANISH KUMAR, SANGEETA CHANDRA

body2023
JUDGMENT Mrs. Sangeeta Chandra, J. Heard Sri J. N. Mathur, learned Senior Counsel assisted by Sri Nishant Mishra and Sri Vaibhav Krishna, learned counsel for the petitioners and Learned Standing Counsel for the State Respondents. 2. This petition has been filed with the following main prayers:- "A- Issue a writ, order or direction in the nature of mandamus commanding respondents no. 2 to 5 to forthwith pay an amount of Rs. 7,97,88,026.31/- to the petitioner alongwith interest, at such rates, as may be determined by this Hon'ble Court; B- In the Alternative, Issue a writ, order or direction in the nature of mandamus commanding respondents no. 2 to 5 to forthwith take necessary action in respect of pending payments of the petitioner in terms of clarification dated 26.10.2021 issued by respondent no. 1 and/or Government Orders dated 09.11.2017 and that of 2019 issued by respondent no.1;" 3. It is the case of the petitioner that it is a partnership firm, which is undertaking several works contracts for the respondents and has been raising running bills which have been paid by the respondents, but the payment of GST on such bills is not being made by the respondents. Prior to the enforcement of the GST regime, the petitioner was awarded a number of contracts by the Public Works Department for construction, widening and beautification of roads in various Districts of the State. The petitioner had paid VAT in accordance with law after taking into account the amount deducted at source by the Public Works Department. There was no dispute in respect of payments made prior to the enforcement of the GST regime. After the enforcement of the GST regime, the respondent no.1 issued a Government Order on 09.11.2017 directing various Heads of Departments that contracts for new works and contracts which were already in existence and were awarded before the GST regime, all were to be governed by the GST regime and the additional tax burden shall be computed with the help of formula with respect to existing contract provided under the Government Order dated 09.11.2017. The amount of additional tax burden so determined had to be paid to the contractor and the said amount of tax was thereafter to be deposited by the contractor with the department. The amount of additional tax burden so determined had to be paid to the contractor and the said amount of tax was thereafter to be deposited by the contractor with the department. Another clarification was issued in this regard on 26.10.2021 also, a copy of which has been filed as annexure to the petition which is in the nature of explaining liability for payment of GST. The petitioner's running bills/invoices have been paid by the respondents no. 3 to 5 after deducting tax at the rate of 2% (1% CGST and 1% SGST) which is only partial deduction of the total tax liability. However, in respect of some works contracts the petitioner has realized after sometime that payment being made by the respondents no. 3 to 5 on such bills/invoices raised by the petitioner are only with respect to principal amount and not the amount of GST. These are all continuing contracts and therefore, governed by the Government Order dated 09.11.2017 and also the clarificatory order dated 26.10.2021. The petitioner has made several requests by various means including making representations, details of which have been given in the petition, but the respondents no. 3 to 5 have not disbursed the GST amount to the petitioner. The petitioner consequently could not deposit the huge amount of tax liability with the GST Department and they are in the process of initiating recovery proceedings against the petitioner. The petitioner's last representation dated 31.03.2022 has indicated the grievance made by the petitioner to the Executive Engineers, Provincial Division, PWD of Districts Basti, Pratapgarh and Sant Kabir Nagar. Such representations are pending. 4. This petition is disposed of with a direction to the petitioner to make a fresh representation to the respondent no.2 who shall seek a clarification from the Engineer-in-Chief and the respondent no. 1 and then decide the representation of the petitioner by a reasoned and speaking order within a period of two months from the date of making of such representation.