(iii) Agreement No.02/MDR/CRF/2016-17 dated 03.6.2016 (Shivpuri Lup -Shitla Mata- Chinor  -Dabra Road- Length 53.20 km)- (NORTH Zone, Gwalior)

(iv) Agreement No.03/MDR/CRF/2016-17 dated 03.06.2016 (Indergarh Pichor Road - Length 9.25 Km) - (NORTH Zone, Gwalior) with Madhya Pradesh Public Works Department has filed this writ petition seeking direction:

    (i) That, the liability of GST which has been imposed upon the PETITIONER after inception of GST Act, 2017 may kindly be ordered to be paid/adjusted to the PETITIONER.

    (ii) That, the RESPONDENTS may be directed to consider and pass orders on PETITIONER's representation regarding the payment of 18% or 12% GST on the value of work done for subjected works contract as the agreement were executed prior to 01.07.2017 and the works are still under progress.

The reliefs sought by the petitioner emanates from the notices issued by Directorate General of GST

 Intelligence Bhopal Zonal Unit on 8.8.2018 and 3.9.2018 (Annexure P/1 and P/2) in respect of nonfiling of GSTR 3B return under section 46 of Central Goods and Services Act, 2017 which mandates that where a registered person fails to furnish a return under Section 39 or Section 44 or Section 45, a notice shall be issued requiring him to furnish such return within fifteen days in such form and manner as may be prescribed. Vide these notices action under Section 62 read with section 29 is contemplated.

Contentions of the petitioner is that because of in-action/in-decision of the respondents Public Works Department the petitioner is subjected to said notices. It is urged that the agreements were executed prior to the commencement of GST which came in existence with effect from 1.7.2017. It is contended that the petitioner is unable to file the GST return because before GST regime the petitioner was liable to pay 2% of the Commercial Tax on Works Contract (Civil) which is now increased to 18% or 12% which is to be compensated by the department. It is urged that though Central Government Organization like Railways, CPWD etc. have notifications in that regard; however, the Public Works Department has not taken any remedial measures provided in Clause 19.17 which stipulates that:

“19.17 Change in law

19.17.1 If as a result of Change in Law, the Contractor suffers any additional costs in the execution of the Works or in relation to the performance of its other obligations under this Agreement, the Contractor shall, within 15 (fifteen) days from the date it becomes reasonably aware of such addition in cost, notify the Authority with acopy to the Authority's Engineer of such additional cost due Change in Law.

19.17.2 If as a result of Change in Law, the Contractor benefits from any reduction in costs for the execution of this Agreement or in accordance with the provisions of this Agreement, either Party shall, within 15 (fifteen) days from the date it becomes reasonably aware of such reduction in cost, notify the other Party with a copy to the Authority's Engineer of such reduction in cost due to Change in Law.

19.17.3 The Authority's Engineer shall, within 15 (fifteen)days from the date of receipt of the notice from the Contractor or the Authority, determine any addition or reduction to the Contract Price,  as the case may be, due to the Change in Law.”

It is urged that though the petitioner is paying GST upon the construction materials during the currency of Works Contract and thereby earning input tax credit (ITC) but is unable to adjust the ITC with the liability as they are not getting GST from the department.

In these factual background the petitioner seeks the directions, quoted supra.

Careful reading of the grievance raised by the petitioner reveals that the same emanates from the agreement entered into between the petitioner and the Public Works Department. It is not disputed by learned counsel for the petitioner that there exists dispute resolution mechanism in the agreements.