Writ maintainability despite contractual remedy, and reimbursement of GST differential where the payer accepted liability

A writ petition was held maintainable despite an alternative contractual dispute-resolution clause because no disputed question of fact survived and the contractual remedy was not an effective bar in the circumstances. On the merits, the GST rate on the works contract increased from 12% to 18% from 01.01.2022, and the respondent had accepted liability for the additional 6% but did not pay it. The petitioner was therefore entitled to reimbursement of the GST differential for the period 01.01.2022 to 30.09.2022, with interest at 6% per annum if payment was not made within the time granted.

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Issues: (i) Whether the writ petition was maintainable despite the availability of an alternative contractual remedy; and (ii) whether the petitioner was entitled to reimbursement of the additional GST of 6% for the period 01.01.2022 to 30.09.2022.

Issue (i): Whether the writ petition was maintainable despite the availability of an alternative contractual remedy.

Analysis: The dispute did not involve any disputed question of fact, and the existence of a dispute resolution clause under the agreement did not justify relegating the petitioner to that remedy in the circumstances.

Conclusion: The writ petition was maintainable.

Issue (ii): Whether the petitioner was entitled to reimbursement of the additional GST of 6% for the period 01.01.2022 to 30.09.2022.

Analysis: The GST rate applicable to the petitioner's works was enhanced from 12% to 18% with effect from 01.01.2022, and the respondent entity had accepted liability for the additional 6% but had not made payment. The State GST Department also treated the enhanced rate as payable by the respondent entity.

Conclusion: The petitioner was entitled to payment of the GST difference at 6% for the said period, with interest at 6% per annum if payment was not made within the time granted.

Final Conclusion: The writ petition succeeded to the extent of directing reimbursement of the GST differential for the relevant period, while the request for ancillary interest was made conditional upon delay in compliance.

Ratio Decidendi: Where the tax liability on contractual works is enhanced by a valid GST notification and the payer accepts liability, a writ court may direct reimbursement of the differential amount when no disputed factual issue survives and the alternate contractual remedy is not an effective bar.

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