Economic Laws Practice (ELP)’s Partner, Ritesh Kanodia has shared his insights with BQ Prime on the recent decision of the Karnataka High Court upholding exemption of GST on annuity payments for road construction. According to Ritesh the decision has put contractors into a dilemma of whether they should charge and recover GST under a change in law clause (considering the positive Judgement), and if they decide to recover GST, whether to take credit for the past (which could be time-barred), and on a going forward basis. The question becomes relevant considering that the department is likely to challenge the decision before the Supreme Court or a possibility of amendment is not ruled out. Another issue that needs to be answered is whether the reimbursement of GST can be on a gross basis or net of credit basis considering the anti-profiteering provisions.
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