The Rajasthan High Court has dismissed a bulk of petitions challenging the levy of GST on ‘royalty’ considering the fact that the matter is pending before a nine-judge bench of the Supreme Court.
writ petitions have been filed by the petitioners assailing the legality and validity of imposition of service tax/goods and service tax (‘GST’) on royalty. Some petitions further urged for an interim relief as the Court has not quashed the earlier High Court orders favouring the assesses.
A bench comprising Acting Chief Justice Mr. Manindra Mohan Shrivastava and Justice Shubha Mehta observed that “though the orders passed by this Court in the cases referred to above repelling challenge to leviability of GST on royalty have been assailed by filing SLPs before the Hon’ble Supreme Court, learned counsel appearing on behalf of all the parties do not dispute that the issue has not been decided by the Hon’ble Supreme Court and learned counsel for the parties have also brought to our notice that the issue as to whether royalty is in the nature of tax has been referred by the Hon’ble Supreme Court for consideration by the Bench of nine-Judge in the case of Mineral Area Development Authority etc. & Others Vs. M/s. Steel Authority of India and Others.”
Concluding the order, the Court added that “Insofar as D.B. Civil Writ Petition No. 5199/2022 is concerned, the petitioners have challenged imposition of GST on royalty as also prayed for some other reliefs. The relief, insofar as challenge to leviability of GST on royalty is concerned, has already been rejected. As ordered earlier, this petition will survive adjudication only in respect of other reliefs.”
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