Karnataka High Court Directs Authorities to Consider GST Reimbursement Claims Upon Submission of Supporting Documents

Karnataka High Court has addressed the issue of reimbursement of Goods and Services Tax (GST) to contractors for payments made after the introduction of the GST regime on 1 July 2017. The petitioner, a contractor, sought various reliefs including the setting aside of impugned notices, a direction to execute a supplementary agreement incorporating the GST component, and a declaration that the delay in execution of works due to non-reimbursement of GST should not be treated as a breach attributable to the petitioner. The petitioner also sought protection from coercive or penal action by the authorities and requested that the authorities be directed to consider its representations for GST reimbursement in a time-bound manner.

The petitioner argued entitlement to payment of differential tax under the GST regime for works executed post-1 July 2017 and relied on a previous order of the High Court in W.P. No. 9721/2019. The petitioner alleged inaction by the respondents in considering its representations for reimbursement and highlighted a delay of 18 months in receiving the GST component.

The Court noted that a Co-ordinate Bench had already addressed an identical issue in W.P. No. 588/2025, which itself relied on the judgment in W.P. No. 25764/2023. In those cases, the Court had directed the authorities to reimburse the GST amount to similarly placed contractors. The petitioner’s counsel submitted that a similar direction would serve the interests of justice in the present case.

On behalf of the respondents, the learned Additional Government Advocate (AGA) contended that the petitioner had only produced a statement indicating alleged payment of GST, without supporting documentary evidence. The AGA submitted that the authorities would be able to examine the claim and pass appropriate orders within 30 days if the petitioner furnished the necessary documents evidencing actual payment or deposit of GST.

Recording these submissions, the Court allowed the writ petition and issued clear directions. The petitioner was directed to furnish supporting documents evidencing payment of GST to the respondents within 15 days from receipt of the order. Upon receipt of such documents, the respondents were directed to examine the claim and pass appropriate orders in accordance with law within 30 days.

This decision reinforces the principle that contractors are entitled to have their GST reimbursement claims considered by the authorities, provided they submit adequate documentary proof of payment. The Court’s order ensures a time-bound process for such claims, aligning with prior judicial precedents on the issue.