Greater NOIDA Authority's GST demand on school lease set aside for lacking proper justification

The HC allowed the writ petition challenging the demand for GST and premium payment by Greater NOIDA Industrial Development Authority. The petitioner had entered into a lease deed for constructing a higher secondary school building and fulfilled most terms except a small premium balance. The court found the GST demand to be non-speaking and contrary to exemption notifications and previous rulings. The HC set aside the GST demand and directed the authority to issue a detailed order justifying GST liability, considering relevant notifications and court judgments before the lease deed date. The authority was ordered to accept the balance premium payment and provide a hearing opportunity before issuing the detailed order.

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Issues:
Challenge to demand raised by Greater NOIDA Industrial Development Authority for GST and premium payment.

Analysis:
The writ petition challenges the demand raised by the respondent authority for GST and premium payment. The petitioner had entered into a lease deed with the respondent for constructing a building for a higher secondary school. The petitioner contends that all terms and conditions of the lease, including payment of premium, have been fulfilled except for a small amount. The demand for GST was communicated to the petitioner, which the petitioner argues is baseless and contrary to exemption notifications and court judgments. The petitioner is willing to pay the balance premium amount but is facing refusal unless the GST amount is also paid.

The petitioner relies on exemption notifications and a court judgment to support their argument that the demand for GST is unjustified. The respondent, on the other hand, mentions modifications in exemption requirements but fails to demonstrate any specific reference to these modifications in the communication demanding GST. The court finds the demand for GST to be non-speaking, contrary to notifications and previous rulings, and sets it aside. The court directs the respondents to issue a detailed order justifying the GST liability, taking into account relevant notifications, advance rulings, and court judgments before the lease deed date.

The court orders the respondents to accept the balance premium payment from the petitioner and provides for a hearing opportunity before issuing the detailed order. The petition is allowed with these directions and observations. The judgment emphasizes the importance of a detailed and reasoned approach in raising demands, especially in matters involving taxation and contractual obligations.

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