TaxTMI 
TaxTMI 
2019 (11) TMI 36
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....o account the rate of works tax at the rate of 4% stipulated in section 8 of the Kerala Value Added Tax Act, 2003 (VAT) as per the special conditions contained in the notice inviting tender. According to the petitioner, the Central Goods and Services Tax Act,2017(GST) was implemented w.e.f. 1.7.2017 imposing GST at 18% on the value of works. By Ext.P2 letter dated 14.7.2017 3rd respondent accepted the tender submitted by the petitioner with probable amount of contract of Rs. 4,66,38,279/- and directing him to execute an agreement for carrying out the works. 3. Petitioner submitted Exts.P3 and P4 representations requesting either to reimburse the additional tax imposed at 14% over the 4% specified in Ext.P1 or cancel Ext.P1 and release and refund the EMD of Rs. 2,00,000/-furnished by him and insisted acceptance of the tender submitted without any variation from Ext.P1. Anyhow 1st respondent sent Ext.P8 letter to the petitioner without considering the request either to reimburse differential tax imposed by the GST or to release the EMD of Rs. 2,00,000/- furnished by him along with the tender. Third respondent by Ext.P10 directed to execute an agreement for carrying out the works wi....
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....t GST will be notified on 1.7.2017 confirming the specified requirement to pay tax at the rate prevalent at the time of execution of work as notified in Exts.R3(a) and R3(b) petitioner submitted his bid. Therefore, now the petitioner cannot wriggle out of the contractual obligation by stating that petitioner is liable to pay only tax as notified in Ext.P1 as well as in Exts.R3(a) and R3(b). 6. The State Government has issued a Government Order dated 27.1.2018 to clarify the different issues raised by the PWD contractors on introduction of the GST. Paragraph 10 of the Government Order stipulates that, the Executive Engineers in the PWD have been directed to deduct only 2% GST from work bills in place of 4% VAT. The GST Council, however, fixed GST on work contracts related to PWD road works at 12% including the 2% deducted by the Executive Engineers. The remaining 10% of GST has to be paid by the PWD contractors directly to the GST department. The PWD or none of the officers coming thereunder has power either to reduce, exempt or reimburse any portion of the GST charges on PWD work bills on any grounds or circumstances. 7. So also it is submitted that, consequent to introduction ....
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....ement for the work at an earlier date. Petitioner was also requested to execute the agreement as per the communication dated 30.4.2018 within three days from the date of receipt of the letter and he was also informed that, if he failed to execute within the time limit, the department will be compelled to take necessary action as per the prevailing Rules. Such letter was issued since petitioner was not responding to any of the communications issued by the 3rd respondent. It is also submitted that, petitioner has to sign the contract as per Ext.P10, however, petitioner did not comply with any of the requests/directions issued by the 3rd respondent. Therefore, according to the 3rd respondent, petitioner has not made out any case justifying interference of this court under Article 226 of the Constitution of India. 9. A reply affidavit is filed by the petitioner refuting the contentions raised in the counter and also the calculation with respect to the benefit accrued to the petitioner on account of introduction of GST and the input credit etc. etc. According to the petitioner, the calculation so made by the 3rd respondent and produced as Ext.R3(e) is not true or correct. So much so i....
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....cute an agreement imposing a liability undertaking to pay the tax in accordance with the Goods and Services Tax Act. It is also submitted by the learned counsel for petitioner that, respondents are not at liberty to insist that, petitioner should enter into an agreement incorporating any condition, which was not notified at the time of issuance of Ext.P1 notice inviting tender. 12. Therefore, the sum and substance of the contention advanced by the learned counsel is that, there is no laches or lethargy on the part of the petitioner in executing the agreement. But the agreement is unable to be executed by the petitioner since unconscionable conditions are put forth by the respondents as per Ext.P5 and other correspondences issued by the respondents. Even though petitioner has submitted Ext.P3 and other representations before the respondents, none of the aspects put forth by the petitioner was taken into account. However, the State Government has resorted to in issuing Ext.P9 notification dated 27.1.2018 issuing directions in the manner in which the amounts are to be recovered in accordance with the provisions of the Goods and Services Tax Act. According to the petitioner, since pe....
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....he tax is increased, petitioner is liable to pay the same as per the stipulations contained under clause 44 quoted above without insisting for any rate variation. So also the tender is to be submitted by a bidder taking into account various factors and components and a little bit of speculation is also required. When clause 44 was incorporated in Ext.P1 tender notification and the introduction of GST was under comprehension and in fact it was made without being introduced and therefore, it cannot be said that, petitioner was not aware of the likelihood of legislation being introduced on and with effect from a future date. Therefore, necessarily, petitioner ought to have visualised such a situation and the rates should have been quoted only in accordance with the same. It is also clear from Exts.R3(a) and R3(b), petitioner has quoted less than the probable amount of contract and according to the learned Special Government Pleader, petitioner wants now to wriggle out of the contract without causing any injury to him. 16. In this context I have come across the judgment of the Apex Court in Syndicate Bnak v. R. Veeranna and others [(2003) 2 SCC 15, wherein the issue of hike in intere....