Allowed

T.I.Raju v. State of Kerala

Kerala HC16 Nov 2023WP(C)/8581/2021

Case brief

AI extract

What is this about?

The High Court allowed a writ petition filed by a government contractor challenging the refusal to refund excess tax paid on pipeline works. The court directed the respondents to refund Rs. 6,39,017/- within one month based on a Notification fixing the tax rate at 2%.

What did the court decide?

Directing the respondents to refund the excess amount of Rs. 6,39,017/- to the petitioner within one month of the judgment.

T.I.Raju Vs State of Kerala — GST and Indirect Tax | Kerala HC (2023)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH

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THURSDAY, THE 16TH DAY OF NOVEMBER 2023 / 25TH KARTHIKA, 1945

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WP(C) NO. 8581 OF 2021

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PETITIONER:

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T. I. RAJU,
AGED 72 YEARS, S/O. LATE T. E. ITHAPIRI,
GOVERNMENT CONTRACTOR, THURUTHUMMEL HOUSE,
KUSUMAGIRI P. O., KOCHI - 682 030.

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BY ADVS.
 SRI. TESSY JOSE
 SRI. VINAY KUMAR VARMA
 SRI. ELDHO PAUL

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RESPONDENTS:

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1STATE OF KERALA,
REPRESENTED BY THE SECRETARY TO GOVERNMENT,
TAXES DEPARTMENT, SECRETARIAT,
THIRUVANANTHAPURAM - 695 001.

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2COMMERCIAL TAX OFFICER,
WORKS CONTRACT, SALES TAX COMPLEX,
3RD FLOOR, JAWAHAR NAGAR, KOZHIKODE - 673 001.
3STATE TAX OFFICER,
WORKS CONTRACT, OFFICE OF THE DEPUTY COMMISSIONER,
GOODS AND SERVICE TAXES, KOZHIKODE - 673 001.

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BY ADV.
 SMT. JASMINE M.M.-GP

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
16.11.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO. 8581 OF 2021

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DINESH KUMAR SINGH, J.

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W.P.(C) No.8581 of 2021

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Dated this the 16^th day of November, 2023

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JUDGMENT

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The present writ petition has been filed challenging Exhibit P-9 order refusing to refund the excess amount of Rs. 6,39,017/-

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paid by the petitioner under the provisions of the Kerala GST Act, 1963.

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Petitioner is a Government Contractor and registered dealer

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under the Kerala GST Act w.e.f. 1993. He is engaged in executing civil works. Petitioner continued as registered dealer under the Kerala Value Added Tax Act and presently he is a registered dealer under the provisions of the CGST/Kerala SGST Act, 2017.

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The petitioner had carried out and executed civil works by Kerala Water Authority in the financial years 2002-03, 2003-04 and 2004-05.

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The petitioner had paid KGST on compounding basis under Section 7 (7) of the KGST Act for the financial years 2002-03 to 2004-05 by filing application in Form No. 21B prescribed under the KGST Rules, 1963. The civil works executed by the petitioner could

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WP(C) NO. 8581 OF 2021

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include construction of pump house building, water tank and supply and laying of pipe lines for water supply scheme.

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After a four years from the date, the petitioner paid the KGST on compounding basis, the 3^rd respondent issued notice under Section 17(3) read with 17(D) of the KGST Act proposing to complete the assessment for the above three financial years and levy tax on the entire contract amount @ 9.66%. The petitioner objected against carrying out fresh assessment on the ground that the proposed fresh assessment was barred by limitation. The 2^nd respondent, however, carried out the fresh assessment rejecting the objections filed by the petitioner and finalised the assessment vide orders dated 24.03.2009, 25.03.2009 and 27.03.2009 in respect of the financial years 2002-03, 2003-04 and 2004-05 respectively. Aggrieved by the said fresh assessment orders, the petitioner filed W.P.(C) No.18047 of 2009. It was dismissed by the learned Single Judge by the Judgment dated 13.07.2009 against which the petitioner filed W.A. No.1829 of 2009. The Division Bench remanded the matter back for fresh assessment by a different team within a period of three months after issuing notice to the petitioner.

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WP(C) NO. 8581 OF 2021

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In compliance to the direction issued by the Division Bench vide the Order dated 08.10.2009 in W.A. No. 1829 of 2009, fresh assessment orders were passed. The 2^nd respondent rejected the claim of the petitioner for concessional rate @ 2.3% for the financial year 2002-03. The petitioner preferred appeal before the Kerala Sales Tax Appellate Tribunal, Kozhikode and the appeal was allowed on 02.02.2011, directing the 2^nd respondent to refund the excess tax collected from the petitioner for the assessment year 2002-03.

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In respect of the financial years 2003-04 and 2004-05, the Tribunal allowed the appeals partly by common Order dated 12.11.2009 and directed that the assessing authority to verify the documents relating to the execution of work by the petitioner and thereafter levy the tax in accordance with the proviso to Section 7(7A) of the Act. It was further directed that; on verification, if it is found that the petitioner was eligible for the same, the Assessing Authority should delete levy of interest prior to the issuance of demand notice. Against the said order dated 12.11.2009 in respect of the financial years 2003-04 and 2004-05, the petitioner preferred S.T. Revn No. 147 of 2010 and 151 of 2010 before this Court. The Learned Division Bench dismissed the revisions confirming the

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WP(C) NO. 8581 OF 2021

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Order passed by the Tribunal. In the meantime, the Government came out with the Notification, SRO No. 858 of 2010 dated 11.08.2010 in exercise of the powers conferred under Section 10 of the Kearla GST Act, 1963. In the said notification it was clarified that the rate of tax levied under the KGST by the work contractors engaged in construction of well, pond, water tank weir, check dam retaining wall and culvert and pipe lines would be 2% and this Notification should be deemed to have come into force from 1^st day of April, 1993. It was also said that the tax, if any, collected should be paid over to the Government and tax already paid shall not be refunded. Thus, w.e.f. 01.04.1993, the rate of tax payable under the KGST in respect of the civil works of well, pond, water tank weir, check dam retaining wall, culvert and pipe line was fixed @ 2% of the contract value.

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The petitioner, in view of the said Notification issued by the State Government filed R.P. Nos.98 and 97 of 2010 against the order passed in S.T. Revn Nos. 147 and 151 of 2010. This Court disposed of the above Review Petitions on 22.02.2011 directing the Assessing Officer to verify the Notification SRO 858 of 2010 dated 11.08.2010 with the Water Authority and awarders and grant concessional rate in respect of the pipe line works executed by the

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WP(C) NO. 8581 OF 2021

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petitioner. The Assessing Authority was also directed to verify with the Water Authority and awarders as to whether the excess tax reimbursed or collected from them, and if so, forfeit the excess collection over the tax found payable. Thus, there was a positive direction to the Assessing Authority that after verification of the notification, the petitioner is to be levied with concessional rate of tax for laying down the pipe line. The direction for forfeiting the tax is to the Water Authority in respect of the tax paid by them and not in respect of the petitioner. The petitioner therefore, filed an application in Exhibit P-6 before the 2^nd respondent for refund of the excess amount paid by him @ 2% as per the Notification dated 11.08.2010. However, the said application has been rejected vide Exhibit P-9 impugned order. I find the stand taken by the Authorities is untenable. In the Judgment passed in R.P. Nos.98 and 97 of 2010, a specific direction has been given to the Assessing Authority to grant concessional rate of tax to the petitioner. The direction for forfeiting the excess amount is in respect of the Water Authority and awarders, not in respect of the petitioner. But, in respect of the petitioner there is specific direction for levying tax @ 2%.

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WP(C) NO. 8581 OF 2021

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The Learned Counsel for the petitioner has submitted that the petitioner will not claim any interest on the said amount and he will be satisfied if the excess amount recovered from the petitioner is paid back to him without interest.

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Thus, in the above circumstances and observations, the present writ petition is allowed. The respondents are directed to refund Rs. 6,39,017/-, the excess amount paid by the petitioner on the work executed by the petitioner for laying down pipe lines which is specifically covered by the notification dated 11.08.2010, within a period of one month from today.

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Sd/DINESH KUMAR SINGH JUDGE

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Svn

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WP(C) NO. 8581 OF 2021

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APPENDIX OF WP(C) 8581/2021

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PETITIONER’S EXHIBITS

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`EXHIBIT P1`	`RETYPED COPY OF THE ORDER OF THE 2ND` `RESPONDENT DATED 24-03-2009 FOR THE` `ASSESSMENT YEAR 2002-2003`
`EXHIBIT P1A`	`RETYPED COPY OF THE ORDER OF THE 2ND` `RESPONDENT DATED 25-03-2009 FOR THE` `ASSESSMENT YEAR 2003-2004`
`EXHIBIT P1B`	`RETYPED COPY OF THE ORDER OF THE 2ND` `RESPONDENT DATED 27-03-2009 FOR THE` `ASSESSMENT YEAR 2004-2005`
`EXHIBIT P2`	`TRUE COPY OF THE ORDER DATED 2-2-2011 IN T.A` `NO. 53/2010 OF THE SALES TAX APPELLANTE` `TRIBUNAL, KOZHIKODE`
`EXHIBIT P3`	`RETYPED COPY OF THE SAID COMMON ORDER IN TA` `NO 312/2009 AND TA NO 313/2009 DATED 12-11-` `2009 ISSUED BY THE KERALA SALES TAX APPELLATE` `TRIBUNAL ADDITIONAL BENCH, KOZHIKODE`
`EXHIBIT P4`	`TRUE COPY OF THE JUDGMENT IN R.P 98/2010` `DATED 22-2-2011 OF THE HON'BLE HIGH COURT OF` `KERALA`
`EXHIBIT P5`	`TRUE COPY OF JUDGMENT R.P NO 97/2010 DATED` `22-2-2011 OF THE HON'BLE HIGH COURT OF KERALA`
`EXHIBIT P6`	`TRUE COPY OF LAST REPRESENTATION SENT BY THE` `PETITIONER TO THE 2ND RESPONDENT DATED 21-07-` `2017`
`EXHIBIT P7`	`TRUE COPY OF THE ACKNOWLEDGEMENT CARD DATED` `24-07-2017 EVIDENCING ACCEPTANCE OF EXT P6` `REPRESENTATION`
`EXHIBIT P8`	`TRUE COPY OF THE JUDGMENT IN WP(C) NO.` `11349/2018 DATED 3-4-2018 OF THIS HON'BLE` `COURT`
`EXHIBIT P9`	`TRUE COPY OF THE REJECTION PROCEEDINGS DATED` `7-09-2018 PASSED BY THE 3RD RESPONDENT`

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WP(C) NO. 8581 OF 2021

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`EXHIBIT P10`	`TRUE COPY OF THE ORDER SRO NO. 858 DATED 11-`
	`08-2010 ISSUED BY THE 1ST RESPONDENT`
	`REJECTING THE EXT.P6 REPRESENTATION`

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`EXHIBIT P11`	`RUE` `TEAM` `FOR` `REFE`	`COPY OF THE PROCEEDINGS OF THE SPECIAL` `CONSTITUTED U/S. 17D OF KGST ACT, 1963` `THE YEAR 2002-2003 DATED 30-06-2012,` `RRED AS ITEM NO. 3 IN EXT P9 ORDER`
`EXHIBIT P12`	`TRUE` `TEAM` `REFE`	`COPY OF THE PROCEEDINGS OF THE SPECIAL` `FOR THE YEAR 2003-2004 DATED 30-06-2012` `RRED AS ITEM NO. 4 IN THE EXT.P9 ORDER`
`EXHIBIT P13`	`TRUE` `FOR` `REFE` `ORDE`	`COPY OF PROCEEDINGS OF THE SPECIAL TEAM` `THE YEAR 2004-2005 DATED 3-07-2012` `RRED AS ITEM NO. 5 IN THE EXHIBIT P9` `R`
`EXHIBIT P14`	`TRUE` `THIS`	`COPY OF THE JUDGMENT DATED 2-02-2012 OF` `HON'BLE COURT IN WP(C) NO. 2185/2012`
`EXHIBIT P15`	`TRUE` `OF T`	`COPY OF THE JUDGEMENT DATED 19-12-2012` `HIS HON'BLE COURT IN WP(C) NO.30447/2012`

T.I.Raju v. State of Kerala

Case brief

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What did the court decide?

T.I.Raju v. State of Kerala

Case brief

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