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2022 (6) TMI 531 - HC - GSTReimbursement of Service Tax / GST - Scope of mutual contract - Levy of Service Tax - onboard catering services provided by the respondent under a temporary license issued to it - respondent is obliged to serve a welcome drink to the passengers who boarded the subject trains or not - Goods and Services Tax (GST) on production charges/supply of meals after 01.07.2017 - person liable for financial burden concerning the food which got wasted due to cancellation or the failure of the passengers to turn up - entitlement of relief alongwith interest. HELD THAT:- It is only on 06.04.2017, when IRCTC indicated to the respondent, that unless it gave its unconditional acceptance to the policy framework captured in its communication dated 07.02.2017, its temporary license, which was expiring on 18.06.2017, would not be extended, that the respondent agreed to provide a welcome drink and bear the financial burden qua the same - Faced with this difficult choice, and having regard to the fact that it had already invested funds in the contractual arrangement arrived at with IRCTC, on 12.04.2017, the respondent accepted the terms indicated in the communication dated 07.02.2017, concerning the supply of welcome drink for the period that was to extend beyond 18.06.2017 - the claim of the respondent qua welcome drink was restricted to the period spanning between 19.12.2016 and 18.06.2017. To be noted, the temporary license was extended by IRCTC till 04.07.2018. The learned arbitrator, correctly concluded that IRCTC could not have deducted the amounts expended by them towards serving welcome drink to the passengers from the bills of the respondent. Whether IRCTC is obliged to reimburse the amount deposited by the respondent towards GST levied, with effect from 01.07.2017, on production charges? - HELD THAT:- IRCTC also does not seem to have disputed the fact, that it has recovered GST from the passengers by factoring the same in the train fare - the argument advanced by IRCTC, that it is not obliged to reimburse GST to the respondent, even if it establishes proof of payment of same, seems completely untenable. As correctly concluded by the arbitrator, GST from 01.07.2017 would have to be reimbursed to the respondent by IRCTC, upon the proof of deposit of the same with the concerned statutory authority - IRCTC has already factored GST in the train fare, lends heft to the stand taken by the respondent, that it should be reimbursed GST deposited by it with the concerned statutory authority. Furthermore, IRCTC was in a position to, in fact, perhaps, claim ITC, at least for the period spanning between 01.07.2017 and 31.03.2018. The partial/interim award dated 15.12.2020, rendered by the learned arbitrator is neither patently illegal nor perverse, as was sought to be portrayed by Mr Majithia, on behalf of IRCTC - Appeal dismissed.
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