GMR Pochanpalli Expreessways Limited Vs Additional Director (Telangana High Court)
The Telangana High Court dismissed a writ petition challenging a show cause notice demanding GST of ₹68.26 crore, along with interest and penalty, on annuity payments received between September 2017 and September 2022.
The petitioner had entered into a Build-Operate-Transfer (BOT) annuity concession agreement with the National Highways Authority of India (NHAI) for widening, operation, and maintenance of a national highway. Construction was completed in March 2009, and the petitioner continued maintenance obligations under the concession agreement. Under the agreement, the petitioner was not permitted to collect tolls; instead, it received fixed annuity payments from NHAI.
Read SC Judgment in this case: SC Declines Interference as GST Dispute Arose From Show Cause Notice
The petitioner contended that annuity payments were equivalent to toll collections and were exempt from GST under Entry 23A of Notification No. 12/2017, which exempts services by way of access to a road or bridge on payment of annuity. It also argued that the impugned Circular dated 17.06.2021 was contrary to the GST exemption notifications and that GST could not be levied because construction had been completed before the GST regime commenced. The petitioner further relied on a Karnataka High Court decision that had quashed the same circular.
