Review Petition Dismissed: No Error in GST Rate Interpretation Post Tender Submission

Case Title: Vishal Verma v. Union of India and Others
Court: High Court of Jammu & Kashmir and Ladakh at Jammu
Petition Number: RP No. 43/2024
Relevant Section: Section 13 and 14 of the CGST Act, 2017
Category of Dispute: Rate of GST (Works Contract)
Date of Judgment: 08.04.2025
Relevant Provisions:

• Section 13, CGST Act, 2017 – Time of supply of services

• Section 14, CGST Act, 2017 – Change in rate of tax

• Article 265 of Constitution of India

• SRO-GST-11 dated 08.07.2017

• SRO-GST-2(Rate) dated 22.08.2017

• Notification dated 21.09.2017

Facts of the Case [¶1–5]

• Vishal Verma, sole proprietor of M/s Kiran Constructions, filed a review petition against the dismissal of WP(C) No. 932/2021 (¶1).

• The dispute centered around GST rates applied to works contracts post the 20th GST Council meeting (held 05.08.2017), which recommended reducing GST from 18% to 12% (¶3).

• The petitioner submitted bids after the Council’s recommendation but before the formal notification (21.09.2017), when 18% was still the notified rate (¶3).

• Contracts were awarded post 21.09.2017, and later, notices for recovery of tax differential were issued (¶3).

• The petitioner argued the bid was based on a 12% rate per SRO-GST-2 dated 22.08.2017 and challenged “Condition 49” of the tender terms as violating GST law (¶5).

Question(s) in Consideration [¶5, ¶10, ¶13]

1. Whether the review petitioner was liable to pay differential GST where bids were submitted before issuance of notification reducing rate?

2. Whether “Special Condition 49” in the tender violated statutory provisions of CGST Act?

3. Whether the review was maintainable in light of previous binding judgments?

Observation of Court [¶7–17]

• No error apparent on record was found; review jurisdiction cannot be invoked to re-argue settled points (¶7).

• Special Condition 49 was binding and provided that quoted rates were inclusive of taxes applicable on the last date for receipt of tenders (¶8–9).

• As the rate on the last date was 18%, any reduction later via notification is not applicable to tenders already submitted (¶10).

• GST Council recommendations are not binding unless notified; Article 265 prohibits taxation without authority of law (¶10).

• Petitioner never challenged Special Condition 49 earlier, and arguments under Sections 13 and 14 CGST Act were held not helpful (¶11–12).

• The court held that the SRO-GST-2 dated 22.08.2017 did not apply to the petitioner’s category of contract. The applicable rate remained 18% until changed via SRO-GST-6 dated 21.09.2017 (¶13–16).

Judgment of the Court [¶18]

• The review petition was dismissed, reaffirming that there was no error on record or any new ground to justify reopening the matter.

Between Fine Lines (Simple Summary in 5 Lines)

The contractor submitted bids assuming a lower GST rate based on GST Council’s recommendations. However, the formal notification reducing the rate came only after the bid deadline. The Court held that the bid must reflect rates notified as of the last submission date. The tender’s special clause bound the contractor to absorb tax fluctuations. As no new ground or error was found, the review petition was dismissed.

Summary of Referred Cases

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