Case Law Details
Surana And Company Vs Union Of India (Chhattisgarh High Court)
The case of Surana and Company vs. Union of India reached the Chhattisgarh High Court concerning the non-refund of a 6% differential GST liability borne by contractors for works contracts. The court directed the refund of the excess tax paid within a stipulated timeframe.
The petitioners contested the applicability of notification No.11/2017-Central Tax (Rate), amended by notification No.03/2022-Central Tax (Rate), which prescribed a GST rate of 18% for works contract services. They sought exemption for contracts executed before 18.07.2022 and demanded a refund of the 6% additional GST paid. The grievance arose from the State Authorities’ inaction in granting the refund despite contracts being signed before the revised rate’s implementation.
The petitioners argued that retrospective application of the amended GST rate was unjust and violated fundamental rights. They highlighted discrepancies in the acceptance of work under pre-revised contracts with the revised GST rate, emphasizing the lack of a refund mechanism.
Conversely, the respondents, represented by counsel, opposed the petitioners’ claims, citing contractual clauses and previous circulars. They contended that the contractors were bound by contract terms, which deemed their rates inclusive of all taxes, including fluctuating rates. Moreover, they argued against the applicability of previous court orders, asserting differences in circumstances.
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