GST deduction under a later contract regime upheld where the agreement made tax applicable from time to time.

A contractor could not resist GST deduction from contract bills merely because the bid was submitted before GST commenced. The contract materials referred to tax as applicable from time to time, and both the Letter of Acceptance and the contract were issued after the GST regime had come into force. As the contractor also received payment for the work executed, the prevailing statutory tax liability applied, and limitation of deduction to the earlier tax structure was not available. The writ petition challenging GST deduction therefore failed, and restraint against such deduction was rejected.

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Issues: Whether the writ petitioner could resist deduction of GST from the contract bills on the ground that the bid had been submitted before GST came into force.

Analysis: The contract materials referred to GST as applicable from time to time, and the Letter of Acceptance and contract were issued after the GST regime had come into force. The petitioner had also received payment for the work executed. In these circumstances, the petitioner remained subject to tax under the GST regime and could not insist on limiting deduction to the earlier tax structure.

Conclusion: The petitioner's challenge failed and the claim for restraint against GST deduction was rejected.

Final Conclusion: The writ petition was not maintainable on the asserted tax basis and was dismissed.

Ratio Decidendi: Where a contract is concluded after the commencement of a new tax regime and the contract contemplates tax as applicable from time to time, the contractor is bound by the prevailing statutory tax liability.

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