DHANOOSH ECONOMICALLY Vs. APSRTC

JUDGEMENT

(1.) The petitioner, M/s. Dhanoosh Economically Poor People Seva Samithi, represented by its Executive Member, filed this writ petition seeking to issue writ of mandamus to declare the action of the respondents in demanding the petitioner to pay Goods and Service Tax (GST) vide letter dated 19-01-2019 issued by the respondent Corporation whereby and whereunder the respondent Corporation demanding the petitioner for payment of GST in respect of its business for the work of contract of maintenance of toilets in the Bus Station, Guntur, including all offices of the Bus Station on a monthly licence fee of Rs.2,76,666/-.

(2.) The case of the petitioner is that the petitioner's firm was maintaining Toilets in the Bus Station, Guntur, including all offices of the Bus Station, on a monthly licence fee of Rs.2,76,666/- and the period of contract is for two years commencing from 19-02-2017 to 18-02-2019, which is extendable for a further period of two years subject to enhancement of licence fee by 10% over previous year's licence fee and the said contract period was extended for a period of one year. The 2nd respondent has been collecting GST from the petitioner on its licence fee from the date of commencement of its work. About three months back, when the petitioner wanted to pay licence fee in respect of its work, the 2nd respondent refused to receive licence fee without GST and insisted to pay GST along with monthly licence fee vide letter dated 19-01-2019. The petitioner's firm is not registered dealer under the GST Act and is not liable to 3pay GST on the amount of licence fee. However, the Commercial Tax Authorities never issued any notice to pay GST. If at all, the petitioner is liable to pay GST, it is only the Commercial Department to demand to pay GST, but not the respondent authorities. The petitioner further stated that in a batch of similar writ petitions i.e. W.P.No.16565 of 2018, 14614 of 2018, 19581 of 2018 and 20057 of 2018, this court issued interim direction directing the respondents to collect the licence fee from the licence holders of the stalls without insisting payment of GST. Aggrieved by the action of the respondent Corporation in insisting payment of GST in addition to licence fee, the present writ petition came to be filed.

(3.) The Law Officer of the respondent Corporation filed counter on behalf of the respondent Corporation stating that the petitioner was allotted outsourcing contract for maintenance of entire Toilet block (Contract for Sanitary) at NTR Bus Station, Guntur, on payment of monthly licence fee of Rs.2,76,666/- (excluding water and electrical charges) for a period of two years from the date of agreement vide Allotment Order No.M1/122(1)/2016-GNT.2, dated 04.02.2017 subject to the terms and conditions stipulated in the agreement. From the inception of allotment of work, no amount of GST was collected from the petitioner. The aforesaid agreement was expired on 18-02-2019 as per the allotment order and agreement between the petitioner and the respondent Management. The petitioner's firm has agreed to pay enhanced licence fee (duly enhanced from Rs.2,76,666/- to Rs.3,04,333/- (by increasing 10% on the old licence fee) + GST 18% amount of Rs.54,778/-, thus amounting to a total of Rs.3,59,111/- in writing vide letter dated 19.02.2019. As such, the amount of Rs.1,28,254/- (Licence Fee of Rs.1,08,690/- + Rs.19,564/- GST amount) was paid towards Licence fee during the period from 19.02.2019 to 28.02.2019 including GST vide M.R.No.18/118284, dated 14.03.2019. The respondent Corporation further stated that as per Clause 43 of the Deed of Licence i.e., outsourcing contract on nomination basis between APSRTC and the petitioner vide letter dated 19.02.2019, the service tax/GST applicable, if any, shall be borne only by the licencee at the rate as communicated by the Government from time to time, and hence, it is mandatory on the part of the licensor to collect GST with licence fee from the licensee to avoid further audit objections and objections, if any, from the Income Tax Department. However, the petitioner can obtain GST number from the Income Tax Department and may remit GST amount directly to the Department, in which case, the payment particulars and necessary paid challans shall be produced for record purpose and audit, but the petitioner has not furnished any payment particulars of GST nor any other information. The petitioner's firm itself agreed to pay GST with licence fee and by virtue of agreement, the petitioner has to pay GST for 10 days. The petitioner had paid licence fee for the month of March, 2019 for an amount of Rs.3,71,573/- (Rs.3,04,333/- licence fee + penalty imposed for late payment of Rs.21,312/- + Electrical charges of Rs.42,828/- + Penalty imposed for late payment of Electrical charges of Rs.1,643/- + fine of Rs.5,000/- vide M.R.No.18/118516, dated 10.05.2019. As such, GST amount was not collected by the respondents. The respondent Corporation had informed the petitioner vide letter dated 19.01.2019 to pay GST right from the allotment of the contract work, as the petitioner is under statutory obligation to pay GST as per law in force and as agreed by the petitioner at the time of allotment of work on nomination basis.