The Hon’ble Karnataka High Court in State of Karnataka & Ors. v. Unique Constructions & Ors. [Writ Appeal No. 615 of 2025 (GM-RES) dated June 10, 2026] partly allowed the appeal filed by the State of Karnataka and held that reimbursement of incremental GST paid by contractors pursuant to transition from the KVAT regime to the GST regime can be claimed only against the concerned employer under the works contract and not against the State Government or the tax authorities. It was further held that the liability to pay GST is a matter of statutory prescription which cannot be altered by contractual arrangements and therefore, no directions could be issued permitting filing of revised returns beyond statutory timelines or waiving interest, penalty and limitation prescribed under the GST law.
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