Case Summary
Case Title: M/s Rehanam Construction Pvt. Ltd. v. Bihar Police Building Construction Corporation & Ors.
Court: Patna High Court
Petition Number: CWJC No. 6945 of 2023
Category of Dispute: Reimbursement of GST and Royalty – Contractual Claim under Standard Bidding Document (SBD) Clause 35
Date of Judgment: 22 January 2025
Relevant Section(s): Not under CGST Act directly, but related to reimbursement of GST liability under Clause 35 of Standard Bidding Document (SBD); connected with contractual rights of contractor after imposition of GST.
Facts of the Case (Paras 2–5)
The petitioner, M/s Rehanam Construction Pvt. Ltd., was awarded a contract for constructing the STF Training Building at Gaya through Bihar Police Building Construction Corporation. An agreement worth ₹33.45 crore (2015) and a supplementary agreement of ₹11.06 crore (2019) were executed. The work was nearly 99% complete.
The petitioner claimed reimbursement of GST liability amounting to approximately ₹2.33 crore under Clause 35 of SBD, which provides for reimbursement of levies/taxes imposed after receipt of tender. Additionally, reimbursement of royalty of ₹28.76 lakh was sought as the MN Form had been duly verified by the Mining Officer. Despite repeated requests and submission of letters in 2019, the Corporation did not reimburse GST or royalty.
Questions in Dispute (Paras 5–8)
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Whether the petitioner is entitled to reimbursement of additional GST liability under Clause 35 of SBD.
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Whether royalty deductions made from the work bill ought to be refunded.
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Whether Corporation’s stand that the claim was “incomplete” could defeat the petitioner’s entitlement.
Court’s Observations (Paras 6–14)
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The Court noted earlier judgment in CWJC 1452/2019 (Patna HC) where differential GST amounts were reimbursed after meetings between contractors and State, which had attained finality.
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Clause 35 of SBD clearly provides that any new levies/taxes imposed after submission of tender are reimbursable.
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The Corporation argued the petitioner’s claim was incomplete (Memo dated 10.11.2022, Annexure R/B). However, the Court held this was not a final decision but merely an internal observation.
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The Court emphasized that such a prima facie opinion cannot override fair consideration of the claim.
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The Court directed the petitioner to re-submit a complete claim with all required documents within two months, and directed the Corporation to pass a speaking order within two months thereafter.
Judgment (Paras 11–17)
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The writ was disposed of with liberty to the petitioner to file a complete claim supported by necessary documents within two months.
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The Corporation must consider the claim strictly in light of Clause 35 of SBD and pass a reasoned order.
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Any admitted claim shall be paid within one month thereafter.
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The Court clarified it was not interpreting Clause 35 substantively at this stage but only ensuring due process.
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Liberty was given to petitioner to rely upon judicial precedents while pressing the claim.
Table of Cases Referred
| Case | Court | Citation/Year | Ratio/Outcome |
|---|---|---|---|
| CWJC No. 1452 of 2019 & analogous cases | Patna High Court | 2019 | Contractors held entitled to reimbursement of differential GST under Clause 35 of SBD; State implemented the decision, finality attained. |
Between Fine Lines
For contractors, this case underscores the importance of filing complete claims with all supporting documents to secure reimbursement of GST or other levies imposed after tender. The Court did not outright grant relief but ensured that the contractual mechanism under SBD Clause 35 must be applied fairly. For industry players, the decision shows that GST liabilities arising post-tender cannot be left unaddressed by government corporations; however, compliance with procedural requirements is crucial.
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