9911796707🚨 Important Update for Our Users
We are transitioning to our new and improved portal - www.taxtmi.com - for a better experience.
Follow us:
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (6) TMI 740 - HC - GSTSeeking a direction to the 1st and 2nd respondents to pay the balance outstanding in the bills submitted by the petitioner and to declare that the respondent University is liable to pay the applicable goods and service tax for the Goods and Services availed by them as per the invoices issued by the petitioner - HELD THAT - The learned Single Judge had relying on clause 11 (f) of the General Conditions of Tender which specifically stipulated that all rates quoted should be inclusive of sales tax concluded that after the introduction of the GST regime the term sales tax had to be understood as Goods and Service Tax and thus the tender document is to be deemed as having provided for inclusion of GST. The learned Judge had noted that the payment towards the second and final part had been accepted by the petitioner without the GST. It was also rightly concluded by the learned Single Judge that any doubt regarding the inclusion of GST or otherwise ought to have been cleared by the petitioner before participating in the bid and instead of doing so the petitioner had participated in the tender and had thereafter chosen to challenge the terms of the tender document after securing the contract and executing the work. The learned Judge holding that after participating in a tender process the bidder cannot turn around and challenge the conditions in the bid document has dismissed the W.P.(C). It is trite and settled law as held in Monarch Infrastructure (P) Ltd. v. Commissioner Ulhasnagar Municipal Corporation and others 2000 (5) TMI 1081 - SUPREME COURT that a term of the tender being varied after the players entered the arena is akin to changing the rules of the game after it had begun. The learned Single Judge was correct in turning down the said prayer. As regards the contentions made based on Annexure A circular produced along with the appeal there are merit in the contention of the respondent that given the clear and precise conditions of tender document which was never objected to or sought to be varied at the appropriate time there is no scope for the reliance placed on the circular that too belatedly. Conclusion - i) Tender conditions once accepted and acted upon are binding and cannot be unilaterally varied by a bidder post-contract execution. ii) Claims for additional payments such as GST when the tender expressly requires bids inclusive of taxes cannot be entertained after the fact. iii) Writ jurisdiction is not appropriate for resolving disputed factual and contractual issues. There are no reason to interfere with the judgment of the learned Single Judge - appeal dismissed.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court in this matter include:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Entitlement to GST payment in addition to contract price Relevant legal framework and precedents: The tender document's General Conditions of Tender, particularly Clause 11(f), required all bids to be inclusive of sales tax. Post-GST implementation, sales tax is subsumed under GST. The principle established in Monarch Infrastructure (P) Ltd. v. Commissioner, Ulhasnagar Municipal Corporation and others, that tender terms cannot be altered after the bidding process has commenced, is directly applicable. Court's interpretation and reasoning: The Court interpreted Clause 11(f) as encompassing GST within the bid amount. It reasoned that the petitioner, having submitted a bid inclusive of all taxes, cannot later claim GST as an additional amount. The Court emphasized that the petitioner accepted payments excluding GST without objection at the time of contract execution. Key evidence and findings: The tender document (Ext.P3) and the agreement (Ext.R1(c)) did not provide for separate GST payments. The petitioner's bills were paid excluding GST. The petitioner did not raise any objection to the tender conditions before or during contract execution. Application of law to facts: The Court applied the principle that tender terms are binding once the bid is accepted and work executed. The petitioner's attempt to claim GST post-facto was tantamount to varying the tender conditions, which is impermissible. Treatment of competing arguments: The petitioner argued that the tender was a template allowing only bid values and names, and that the estimated costs were exclusive of taxes, relying on a Government circular. The Court rejected this, holding that the tender terms were clear and unchallenged at the relevant time, and that the circular could not override the explicit tender conditions. Conclusion: The petitioner is not entitled to claim GST separately beyond the agreed bid amount inclusive of taxes. Issue 2: Applicability and effect of Government circular dated 14.12.2017 (Annexure A) Relevant legal framework and precedents: The circular mandates that estimates and payments by Government Departments or agencies should be exclusive of GST and that payments must include GST separately. Court's interpretation and reasoning: The Court acknowledged the circular but held that clear and precise tender conditions cannot be overridden by a circular, especially when the circular was not produced before the Single Judge and was relied upon belatedly. Key evidence and findings: The circular was not part of the original pleadings or evidence before the Single Judge. The tender document explicitly required bids inclusive of taxes. Application of law to facts: The Court applied the principle that tender documents govern contractual relations and that administrative circulars cannot alter contractual obligations post-bid acceptance. Treatment of competing arguments: The petitioner relied heavily on the circular to support their claim for GST payment. The Court found this reliance misplaced given the tender's express terms and the timing of the circular's production. Conclusion: The circular does not entitle the petitioner to additional GST payments contrary to the tender conditions. Issue 3: Maintainability of Writ Petition under Article 226 in presence of disputed factual questions Relevant legal framework and precedents: It is settled law that writ jurisdiction under Article 226 is not ordinarily available to adjudicate disputed questions of fact, especially contractual disputes requiring detailed factual examination. Court's interpretation and reasoning: The Court held that the petitioner's claim involved disputed factual issues regarding contractual terms and payments, which are not amenable to resolution by writ petition. Key evidence and findings: The petitioner's claim for GST payment raised factual disputes about the interpretation of tender terms and payment records. Application of law to facts: The Court applied the principle that such disputes are to be resolved in appropriate civil proceedings rather than by writ petition. Treatment of competing arguments: The petitioner sought relief by way of writ petition; the Court found this inappropriate given the factual controversies. Conclusion: The Writ Petition was not maintainable on the facts and law. Issue 4: Effect of petitioner's failure to challenge Ext.P13 communication Relevant legal framework and precedents: Legal principles require that specific administrative orders or communications be challenged directly to maintain claims arising therefrom. Court's interpretation and reasoning: The Court noted that the petitioner did not challenge Ext.P13, the official communication declining the GST payment claim, thereby undermining the legal foundation of the writ petition. Key evidence and findings: Ext.P13 clearly stated reasons for refusal of GST payment, which was not assailed in the writ petition. Application of law to facts: The Court applied the principle that failure to challenge the impugned communication limits the scope of relief available. Treatment of competing arguments: The petitioner's general prayers for relief were held insufficient without challenging Ext.P13 specifically. Conclusion: The writ petition was legally unsustainable due to non-challenge of the key administrative order. 3. SIGNIFICANT HOLDINGS The Court held:
Core principles established include:
Final determinations on each issue were in favor of the respondents, resulting in dismissal of the writ appeal and upholding the judgment of the learned Single Judge.
|
