M S Ajab Singh and Co. Vs Commissioner of CGST (Delhi High Court)
The petitioner, a contractor engaged by the Delhi Jal Board (DJB), filed a writ petition challenging a Show Cause Notice dated 30 September 2025. Through the notice, the GST authorities sought recovery of differential GST of 6% on works contract services executed for the Delhi Jal Board.
The dispute concerns the applicable GST rate on works assigned by the Delhi Jal Board to private contractors, namely whether such services attract GST at 12% or 18%.
The petitioner contended that the Delhi Jal Board is a local authority, relying on a decision of the GST Department’s policy wing dated 16 November 2020. However, the GST Department’s position in other matters involving the same issue is that the Delhi Jal Board is not a local authority and, therefore, contractors are not entitled to any benefit available on that basis under Section 2(69) of the Central Goods and Services Tax Act, 2017.
The petitioner further submitted that the issue affects several contractors who have received similar notices and that GST had already been deposited at the rate of 12%.
The Delhi High Court observed that the question whether the Delhi Jal Board qualifies as a local authority is a legal issue requiring determination to avoid prolonged proceedings. Considering the nature of the dispute, the Court held that the matter deserved examination in a writ petition.
