Court Orders Decision on GST Refund Claim in 60 Days, Arbitration Not Required Yet as Dispute Unresolved

The HC directed the respondents to decide on the petitioner's claim for a GST refund within 60 days, considering the changes in GST rates and the petitioner's unaddressed requests. Despite the State's argument for arbitration due to an existing clause in the contract, the Court found that arbitration was not yet necessary as the claim had not been formally rejected or disputed. The writ petition was disposed of, allowing the petitioner to pursue further remedies based on the respondents' forthcoming decision.

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Issues:
Claim for refund of GST under a contract awarded before 01.07.2017 with subsequent changes in GST rates. Petitioner's grievance regarding non-release of tax amount paid under GST law along with interest. Opposing view by State counsel citing arbitration clause in the contract.

Analysis:

1. Claim for Refund of GST: The petitioner sought a writ or direction for the release of the tax amount paid under the GST law, highlighting the changes in GST rates from 18 percent to 12 percent. The petitioner referred to circulars by the State Govt. regarding refunds for taxes subsequently imposed. The petitioner's claim remained unanswered despite repeated approaches to the authorities concerned.

2. Arbitration Clause: The State counsel contended that the contract between the parties included an arbitration clause, suggesting that the petitioner should pursue arbitration for dispute resolution before seeking judicial intervention. The State argued that since the petitioner had not utilized the arbitration remedy, the writ petition was premature and not sustainable at that stage.

3. Judicial Decision: The Court considered the circulars cited by the petitioner and the lack of response from the respondents to the petitioner's claim. The Court noted that as the claim had not been rejected or disputed by the respondents, the petitioner was not yet required to invoke the arbitration clause. The Court directed the respondents to decide on the petitioner's claim for GST refund within 60 days from the date of the order. The petitioner was granted the liberty to pursue appropriate remedies based on the decision made by the respondents.

4. Conclusion: The writ petition was disposed of based on the Court's directions to the respondents to address the petitioner's claim for GST refund promptly. The Court emphasized the importance of resolving the issue within a specified timeframe and allowed the petitioner to take further action based on the respondents' decision.

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