Case Law Details
Bai Mamubai Trust Vs Suchitra (Bombay High Court)
In the present case, where the Plaintiff has made out a strong prima facie case and the Defendant has not been able to demonstrate any semblance of right to occupy the Suit Premises, it cannot be said that the Defendant’s occupation pursuant to an Order of the Court is a contract involving a ‘supply’ for consideration. In the absence of reciprocal enforceable obligations, it would not be correct to characterise the Defendant’s occupation of the Suit Premises against payment of royalty as a ‘supply’ for ‘consideration’ on which GST is payable by the Court Receiver.
On a perusal of Section 7 of the CGST Act, it is clear that for a supply to fall under Section 7(a), 7(b) or 7(d) of the CGST Act there must be a contemplated consideration. Only activities specified in Schedule I to the CGST Act are considered a supply, even if made without consideration. It is not the contention of any of the parties before the Court that the occupation of the Defendant of the Suit Premises in the present case falls within Schedule I to the CGST Act. On a perusal of Schedule I to the CGST Act, it does not appear that the present activity would fall within the ambit of Section 7(c) of the Act read with Schedule I thereto.
High Court held that mere receipt of some amount of money (consideration) is not sufficient to term a transaction as a supply but receipt of money (consideration) must be against a ‘supply’ and ‘supply’ must be in respect of reciprocal enforceable obligations.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
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