Jharkhand HC Directs Action Against Service Provider for Withholding GST, Awards Costs to Petitioner

By Jyoti Baluni Goods and Services Tax Judiciary , Trending June 19, 2025

TaxGuru Citation: 2025 taxguru.in 4918
Case Name: R.K. Transport & Constructions Limited Vs State of Jharkhand through its Secretary (Jharkhand High Court)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: All High Courts, Jharkhand High Court

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R.K. Transport & Constructions Limited Vs State of Jharkhand through its Secretary (Jharkhand High Court)

Jharkhand High Court’s Landmark Ruling on GST ITC Denial! in the case of M/S. R.K. Transport & Constructions Limited Vs State of Jharkhand (W. P. (T) No. 1624 of 2024, Dated 13.06.2025)

The Jharkhand High Court recently delivered a significant judgment in the case of M/S. R.K. Transport & Constructions Limited vs. The State of Jharkhand, addressing the denial of Input Tax Credit (ITC) due to a vendor’s failure to deposit collected GST. R.K. Transport, engaged in coal loading, unloading, and transportation, availed commercial vehicle rental services from a sixth respondent. For the period of October 2020 to March 2021, the sixth respondent issued invoices totaling over Rs. 73 lakhs, including SGST and CGST of approximately Rs. 11.18 lakhs, which R.K. Transport paid. However, the GST paid by R.K. Transport was not reflected in their GSTR-2A because the sixth respondent failed to file their GSTR-01, thereby preventing R.K. Transport from availing ITC of roughly Rs. 11.17 lakhs and incurring a financial burden.

R.K. Transport issued legal notices and representations to both the sixth respondent and the official GST authorities, urging them to take action. Despite these efforts, including a previous writ petition which directed them to make a fresh representation, no action was taken. The official respondents initially argued that the sixth respondent fell under the jurisdiction of Central GST authorities, thus absolving them of responsibility. However, the High Court rejected this argument, citing Section 76 of the Jharkhand GST Act, 2017, which mandates that any person collecting GST must remit it to the government, and if not, the proper officer can initiate proceedings. The court emphasized that the official respondents have a duty to act against any person, even if not registered under the JGST Act, who collects tax but fails to deposit it.