GST Reimbursement Claim Not Covered by Arbitration Clause: Supreme Court Restores Contractor’s Writ Petition

The contractor filed a writ petition before the Chhattisgarh High Court to enforce its contractual right to a refund of the GST it had paid, relying on Clause 2.14.A of its contract with the Chhattisgarh Housing Board, whose note said service tax would not apply and, if applicable, would be reimbursed by the Board (para 2). The contract also had an arbitration clause, Clause 1.21 (para 3). The High Court dismissed the petition, holding that the claim arose out of the contract, could be resolved through arbitration, involved disputed facts and was not a public law dispute (para 4); the review petition was dismissed on 06.10.2025 (para 5).

Having considered the matter in detail, the Court held that the dispute over the refund claimed under Clause 2.14.A would not fall within the purview of the arbitration clause in the contract dated 05.02.2016 (para 7). The High Court was therefore not justified in dismissing the writ petition on the ground that an arbitration agreement existed between the parties (para 7). On the rival readings of Clause 2.14.A and of earlier High Court decisions (para 8), and on the merits generally, it expressed no opinion; it allowed the parties to raise all questions of law and fact before the High Court, which must decide the case in accordance with law and within the scope of judicial review (para 9).