Shivalik Housekeeping Services Vs Department of Revenue And Ors (Delhi High Court)
In a recent order, the Delhi High Court has addressed a writ petition filed by Shivalik Housekeeping Services challenging a Goods and Services Tax (GST) demand of ₹21,80,36,550. The petitioner, which supplies housekeeping services to government educational institutions, sought a waiver of the mandatory 10% pre-deposit required to file an appeal against the Order in Original dated January 20, 2025. The company contended that its services are exempt from GST under Notification No.12/2017- Central Tax (Rate) and a subsequent 2018 notification, arguing that the services rendered to government educational bodies fall under the ‘pure services’ category. It was submitted to the court that based on this interpretation, the company had not collected any GST from its clients. The High Court, after issuing notice to the Department of Revenue, opined that the core issue—whether the petitioner’s clients are covered by the exemption notifications—is a factual matter that requires detailed examination of each client’s status. The court deemed the Appellate Authority the appropriate forum for this determination. Acknowledging the “peculiar facts” of the case, specifically that the petitioner had not collected the tax from its clients, the court permitted the company to file its appeal by July 10, 2025. In its final directive, the High Court disposed of the petition by instructing the Appellate Authority to first consider the facts and then determine the pre-deposit amount payable by Shivalik Housekeeping Services, rather than granting a direct waiver.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This hearing has been done through hybrid mode.
2. The present writ petition has been filed by the Petitioner-Shivalik Housekeeping Service under Article 226 of the Constitution of India seeking a waiver of the prescribed pre-deposit (10% of the tax amount) for preferring an appeal under Section 107 of Central Goods and Services Tax Act, 2017 (hereinafter ‘CGST Act’).
3. The Petitioner intends to prefer an appeal from the Order in Original dated 20th January, 2025 vide which a demand to the tune of Rs. 21,80,36,550/- has been raised against the Petitioner who is engaged in supply of House Keeping Services to Respondent Nos. 3, 4 and 5 which are Government Educational Institutions.
4. It is the Petitioner’s case that manpower services rendered to Government Educational Institutions shall be exempted from the Scope of GST in terms of Serial no. 3, Chapter 99 in Notification No.12/2017- Central Tax (Rate) dated 28th June, 2017 read with Notification No.2/2018-Central Tax (Rate) dated 25th January, 2018
5. It is further submitted by the ld. Counsel for the Petitioner that the Petitioner, under the presumption that Government Educational Institutions were exempt from the purview of GST, had not even collected GST from the various educational establishments to whom the housekeeping services were provided.
6. Issue notice. The ld. Counsel for the Respondent-Department accept notice.
7. The issue in the present case pertains to whether the entities to whom the Petitioner rendered housekeeping services were exempt from the levy of GST, in view of the definition of ‘pure services’ and ‘government entity’ in Notification No.12/2017- Central Tax (Rate). The relevant entries are extracted below:
8. In the opinion of this Court, the question as to whether the clients of the Petitioner are covered by the relied upon notifications or not would have to be examined on facts after analysing the status of each of the clients. The Appellate Authority would be the appropriate forum to determine the above raised question.
9. Considering the fact that,
i. the Petitioner itself has not collected GST from its clients; and
ii. the question as to whether the entities to whom the Petitioner has rendered services were covered by the exemption or not would have to be looked into by the Appellate Authority;
the Court is inclined to permit the Petitioner to file an appeal under Section 107 of the CGST Act. The Appellate Authority, after considering the facts, shall also determine the amount of pre-deposit to be made by the Petitioner. This order is passed in the peculiar facts of the present case.
10. The Petitioner is accordingly permitted to avail of the appellate remedy by 10thJuly, 2025 along with an application seeking determination of the pre-deposit payable, which shall be considered in accordance with law by the Appellate Authority, as directed above.
11. Accordingly, the present writ petition is disposed of. All the pending applications, if any, are also disposed of.
