The court emphasizes the need for internal resolution between the Union of India and a public sector undertaking regarding tax liability under the Central Goods and Services Tax Act, 2017.

ORDER :

1. Dr. Abhishek Manu Singhvi, learned Senior Counsel and Mr. Vikram Nankani, learned Senior Counsel assisted by Mr. Sheetal Kumbhat, Mr. Tushar Jarwad and Mr. Vikrant Maheshwari, submit that they are representing the private party, who shall be required to contest the leviability arising out of the show cause notices issued or proposed under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as ‘the Act of 2017’) only once the liability is fastened upon the licensee (ONGC). The issue of the liability spillover from licensee to the private contractors they represent would be required to be adjudicated subsequently.

2. At this stage, Mr. Balbir Singh, learned Senior Counsel assisted by Mr. Karan Sachdev, Mr. Samyak Jain, Mr. Gaurav Sharma and Mr. Vineet R. Dave submits that ONGC is open to making submissions on merits so as to get the leviability adjudicated, and once, the same is ascertained, rest of the issues could be taken thereafter.

3. Mr. R.D. Rastogi, learned Additional Solicitor General of India assisted by Mr. Devesh Yadav was asked by the Court as to why principal adjudication for a crucial and critical revenue statute of the Act of 2017 between the Union of India and one of its owned PSU’s cannot be resolved in an internal mechanism by virtue of some kind of dialogue as there would not be much of adversarial contest involved.

3.1 Mr. Rastogi submits that though the interpretation of tax statutes has to be strictly construed, but at the same time, agreed that the appropriate authorities of Union of India and ONGC shall try to thrash out as to whether there could be a workable solution regarding the interpretation of leviability of the Act of 2017 qua ONGC.

3.2 Mr. Rastogi, seeks some time to complete his instructions to make efforts at appropriate level to ensure that some kind of conjoint consideration of the issue is made by the authority to arrive at a conclusion/solution and, in case, such conclusion/solution is not arrived at, then Mr. Rastogi submits that on the next date, he will be prepared to make submissions on the merits of the case.

4. At this stage, Mr. Nankani has drawn the attention of this Court to Sections 73 & 74 of the Act of 2017 noting that three years limitation period expires on 25.02.2025, and therefore, the statutory time limits could be better met with in case, if an interim order is passed to meet with adverse impact of Section 75(1) of the Act of 2017.

5. In response, Mr. Rastogi submits that since the timeline permits upto 25.02.2025, therefore, rather than granting an interim protection at this stage, the matter be kept before 25.02.2025 and the Hon’ble Court may adjudicate the issue, in case, so required.

6. Upon such submissions having been made, this Court is conscious of the fact that the ONGC is the licensee having liability for the payment of tax proposed by the Union and since the PSU is an entity which is a Government of India Company and is owned, controlled and administered by the Union of India, this Court is of the opinion that Mr.Rastogi may use his good offices at the appropriate levels, in conjunction with Mr. Balbir Singh, to explore a resolution.

7. List the matters on 25.02.2025.