Differential Tax Amount Post-GST Not Reimbursed to Contractors

Bhanjadeo Constructions Vs State of Odisha & Others (Orissa High Court)

The Hon’ble Orissa High Court, in the case of M/s. Bhanjadeo Constructions v. State of Odisha & Others, [W.P.(C) No.38497 of 2021] granted major relief to contractors by staying the coercive steps against the contractors and ordered the State GST department to abide by its circular, Finance Department vide Office memorandum No. FIN-CTI-TAX-0045-2017/38535/F dated December 10, 2018 to address the problems with works contracts brought on by the change from the Value-Added Tax (“VAT”) to the Goods and Services Tax (“GST”) tax system.

Facts:

M/s. Bhanjadeo Constructions (“the Petitioner”) challenged the decision of Respondent to withhold payment of the differential tax amount resulting from the change in tax regime, i.e. from VAT into the GST which took place on July 1, 2017.

Issue:

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