In re Karam Chand Thapar & Bros (Coal Sales) Limited (GST AAAR West Bengal)
West Bengal AAAR set aside the Advance Ruling, holding that completed transactions requiring factual examination were not maintainable under Chapter XVII of the CGST Act.
Material Facts
The appellant had entered into three contracts with THDC India Ltd. in 1996 for construction of hydro power projects. The works were completed during 2007–08 and final payments were received in 2011. During execution of the contracts, disputes arose regarding various claims including extra expenditure, reimbursements, price adjustments, deductions, and arbitration costs. The disputes were referred to arbitration pursuant to directions of the Supreme Court and Delhi High Court. The Arbitral Tribunal passed awards in 2023 allowing certain claims wholly or partly. Thereafter, conciliation proceedings were undertaken, resulting in a Settlement Agreement in October 2024 under which payment was received by the appellant.
Procedural History
The appellant sought an Advance Ruling under Section 97 of the CGST Act on whether various amounts awarded by the Arbitral Tribunal constituted supply, whether they were liquidated damages, whether GST was applicable, the applicable SAC and tax rate, liability on arbitration costs, issuance of invoices, and applicability of GST where work had been executed before introduction of GST.
