MUSLIM ALI Vs. STATE OF ASSAM

JUDGEMENT

(1.) The petitioner before this Court is a registered Civil Contractor with the PWD (Roads), Assam. The petitioner has executed several works for the department and has earned good reputation in his line of work. Since the year 2000, the Government of India has initiated a scheme "Pradhan Mantri Gram Sadak Yojana"(PMGSY) to strengthen roads in the rural areas of the country for boosting economic activities. The scheme is fully sponsored by the Central Government under the Ministry of Rural Development. These Village roads are constructed as per the specifications of the Indian Road Congress (IRC), which is the Apex body of Highway EngineeRs.in the country.

(2.) As per procedure from time to time, the petitioner raised his running bills and demanded for payment in respect of the works completed. These running bills were prepared after the measurement of works completed by the department. By bill number RACC/IV/PMGSY/129 dtd. 25/3/2021, the department prepared running bill of Rs.9,34,19,141.00. Payment for an amount of Rs.7,43,15,546.00 had already been released to the petitioner and after deduction of the same, balance amount of Rs.1,21,035,95.00 was paid to the petitioner. However, while preparing the running bills, the authorities did not add the GST payable to the billed amount @ 12%.

(3.) The learned Senior counsel for the petitioner urges before the court that under the provisions of the Central Goods and Service Tax Act 2017 and the Assam Goods and Service Tax Act 2017, the structure under the scheme of the Act, in respect of the services rendered by the petitioner the payment of GST has to be paid by the last recipient of the goods and/or services. Therefore, as per law, in matteRs.of works contract, the GST on the billed amount prepared by the department has to be paid by the department as it is the last recipient of the services rendered in the said works contract being executed by the petitioner. It is therefore submitted that this amount of GST may be paid by the petitioner only upon receipt of the GST amount being released by the department. Once the amount is released by the department, the GST amount shall be paid to the Government Exchequer. Since the department did not release the amount of GST in respect of the running bills raised, he could not deposit the same in the Government exchequer. It is submitted that at present the rate of GST is 12% for such contract work being executed by the petitioner. It is the apprehension of the petitioner that for failure to deposit the GST amount, petitioner may have to face adverse consequence under the provisions of law. It is further submitted that instead of adding the GST to the billed amount raised and releasing it to the petitioner, the respondent authorities have instead deducted CGST and SGST from the running bills of a petitioner at the rate of 2% and consequently the respondents have deducted an amount of Rs.16,68,200.00 up to the fourth running bill illegally. It is submitted that being aggrieved, the petitioneRs.filed a representation dtd. 9/2/2022 before the Chief Engineer, PWD (Border Roads), Assam, raising his grievances and the prejudice faced by the petitioner for Non-Payment of GST to the petitioner in respect of the running bills released. However, no response was received from the respondent department in respect of the representation filed.