Tax liability exists under GST for construction services, notwithstanding the execution date of prior development agreements. Notifications clarify that such services are exigible to tax upon completion and transfer of rights.

CAV JUDGMENT

(Per: HONOURABLE MR. JUSTICE RAJEEV RANJAN PRASAD)

Date : 05-05-2025

Heard Mr. D.V. Pathy, learned senior counsel for the petitioner, learned ASG for the CGST & CX and Mr. Vikash Kumar, learned SC-11 for the State-respondent.

2. Petitioner in the present writ application is a Private Limited Company engaged in the business of construction of buildings/apartments in the State of Bihar.

3. By filing this writ application, the petitioner-company is questioning the order dated 30.11.2023 and the summary of order in Form GST DRC-07 (Annexure-P2 series) passed by the Assistant Commissioner of Assistant Commissioner of State Tax, Muzaffarpur (respondent no.4) under Section 73 (9) of the Bihar Goods and Services Tax Act (hereinafter referred to as the ‘GST Act’).

4. The respondent no.4 has held the petitioner liable to pay a total amount of Rs.4,61,72,628/- on account of the CGST/BGST and IGST to the tune of Rs.2,37,59,706/-. The pe- titioner has been held liable to pay interest thereon at the rate of 1.5% per month i.e. Rs.20017554/- and penalty of Rs.2,39,5368/-.

Challenge to the Notifications

5. The petitioner has also challenged the Notification No.09/2023 dated 31.03.2023 as contained in Annexure-P8 and the Notification No.56 of 2023 dated 28.12.2003 present at An- nexure-P9 to the writ application. By these two Notifications, the respondent no.2 has extended the time limit specified under sub-section (10) of Section 73 of the CGST Act for issuance of order under sub-section (9) of of the GST Act for recovery of tax not paid or short paid or input tax credit wrongly availed or utilized upto 31^st March, 2024 for the Financial Year 2018-19.

6. Mr. D.V. Pathy, learned senior counsel for the petitioner submits that so far as challenge to the validity of the Noti- fications contained in Annexure-P8 and P9 are concerned, the same is pending consideration before the Hon’ble Supreme Court in Special Leave to Appeal © No(s). 5864-5869/2025 (M/S. Turbo Megha Airways Private Ltd. vs. Deputy Commissioner of State Tax-III & Ors.

7. The aforesaid contention of Mr. D.V.Pathy, learned senior counsel for the petitioner has been contested by Mr. Vikash Kumar, learned SC-11 for the State saying that so far as the two Notifications are concerned, those would not have any bearing upon the present case. It is submitted that the petitioner has claimed that the Notifications are beyond the powers con- ferred by Section 168A of the CGST Act inasmuch as there was no force majeure in existence at the time of bringing out the no- tifications. It is submitted that the impugned assessment order dated 30.11.2023 has been passed within three years from the due date for filing of Annual return for 2018-19, as stipulated under Section 73 (10) of the CGST/BGST Act. Since the extended date for filing annual return for 2018-19 was 31.12.2020, the assessment order under (9) has to be completed up to 31.12.2023. In this case, it has been completed on 30.11.2023 within the deadline, therefore, the issue raised by the petitioner in this regard is irrelevant, redundant, superfluous and only an attempt to mislead this Court.

8. Mr. Vikash Kumar, learned SC-11 has pointed out to this Cou