Point of Law: If any amount is collected as tax, without authority of law, refund of the same can be claimed by filing a suit. It is also settled proposition of law that such refund can also be directed in a writ petition filed under Article 226 of Constitution of India.

ORDER :

T. Vinod Kumar, J.

This Writ Petition is filed by the petitioner, seeking a direction to the 1st to 6th respondents, to reimburse GST at 12% on the value of construction work done under the agreement dated 05.08.2017 entered into with the 5th respondent; and also direct the respondents not to deduct VAT amount of Rs.11,93,172/- and 1% of CGST and SGST while releasing the final bill in relation to the agreement dated 05.08.2017; and to direct refund of the VAT amount deducted to the petitioner along with 18% interest from the due date till the date of payment along with exemplary costs.

2. It is the case of the petitioner that the 5th respondent had floated a tender for civil construction work viz., (a) construction of office building over Rythu rest house; (b) construction of shops; (c) raising of compound wall; (d) maintenance of structure; (e) construction of covered shed and (f) laying of CC road and yard at market yard for the Agriculture Market Committee, Cherial, Siddipet District.

3. It is contended that, though the said tenders were called for in April, 2017 and the petitioner having participated therein and was declared as L1, the agreement awarding the contract to the petitioner was entered into on 05.08.2017. The value of the contract awarded under the agreement entered into with the petitioner for the above said work was for a sum of Rs.2,75,45,328.54 ps.

4. One of the terms of the agreement specifies that the special conditions mentioned in Appendix - I shall be read and construed as forming part of the agreement and the parties shall abide by the same.

5. One such condition specified in Appendix - I states that the Value Added Tax (VAT) payable for the work under the agreement shall be in addition to the amount specified in the agreement and the same shall be added and deducted by the contractee and remitted to the concerned VAT authorities, and the rate of VAT/TOT is specified as 5%.

6. It is contended that, though the agreement entered into between the parties provided for payment of VAT for the construction work over and above the amount specified in the agreement, by the time the 5th respondent entered into agreement with the petitioner, the Telangana VAT Act, 2005 was repealed and in its place the GST Act, 2017 was brought into force; and consequently the work undertaken by the petitioner would be liable to tax under the GST Act and no VAT / TOT is payable.

7. It is the case of the petitioner that despite the repeal of TSVAT Act, the 5th respondent, instead of applying the applicable rate of GST to the running bills submitted based on the progress of the work, had added VAT at the rate of 5% to the said bills and deducted such VAT added to the bills, and remitted the same to the 8th respondent, who also continued to receive such payment, despite the work having been performed post-introduction of GST and the VAT Act having been repealed.

8. Thus, it is claimed that, as the tender floated by the 5th respondent and the agreement excluded the VAT payable, and the said VAT Act being replaced by GST, the 5th respondent is liable to pay GST at the rate of 12% on the agreement value.

9. It is also contended that the petitioner, with the introduction of GST, had obtained registration and had discharged its GST liability at the rate of 12% on the value of work executed, notwithstanding the fact that the 5th respondent did not reimburse the GST; and that the 5th respondent, on the contrary, added 5% VAT/TOT to the running bills raised by the petitioner, and deducted and remitted the same to the 8th respondent, who continued to receive the said payment which is without authority of law.

10. On the basis of the above submission, it is contended that the 1st to 6th respondents are liable to reimburse the petitioner at the rate of 12% on the contract value and the action of the respondents, in particular, the 5th respondent in seeking to deduct an amount of Rs.11,93,172/- being VAT paid to the 8th respondent from and out of