Madras High Court Directs Railways Administration to seek clarity on GST impact in individual works contracts

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HC dismisses assessee’s writ petition seeking direction to Railway authorities to implement instructions issued by Railway Board and to pay differential GST in respect of works contract entered prior to introduction of GST regime but completed thereafter; Assessee, referring to such instructions which required supplementary agreement with contractor for dealing with GST impact in individual contracts, argued that necessary direction should be issued as GST paid by assessee is 12% whereas Railways has paid at old rate of 2%;

HC elucidates that, to study the impact of GST in individual contracts, there might be occasions for Railway Administration to consult the Principal Officer (GST and Central Excise) in which case, latter “would be in a position to issue necessary clarification or guidelines to the Railway Administration”; Noting that assessee has not approached Railways by way of representation or request but straight away approached the Court for a direction, holds that assessee’s petition cannot be entertained, while further stating that, issue which is now pointed out is a larger issue and it is not a single contractor centric”.

Consequently, directs assessee to submit a representation to Divisional Railway Manager (Works) along with copy of the order who shall consider the same and obtain required clarification from Principal GST Officer and pass order on merits.

Citation: TS-309-HC-2018(MAD)-NT]