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The lease holders are required to pay the GST under the reverse charge mechanism.

Reverse charge— the facts of this case are that the petitioners are engaged in the business activity of mining and are registered lease holders and have lawful mining lease in their favour. The letter of the Finance Department, Government of Rajasthan to Royalty Contractors became the bone of contention in these writ petitions, as the same entitled the contractor to collect GST @ 18% as forward charges. the petitioners submit that the letter issued by the Finance Department, Government of Rajasthan to authorize the contractor to collect the GST on the amount of royalty collected on behalf of the Government was against the provisions of Section 9(3) of CGST Act. Held that— Once, the reverse charge mechanism itself has not been contested by the respondents and it is an accepted proposition and the same is further supported by the pleadings filed by the respective respondent parties, we do not find any reason to make any further adjudication in the matter. In light of the aforesaid submission and upon such stand of the respondents, the present writ petitions are allowed and the letter dated 8-11-2017 issued by the Finance (Tax) Department, Government of Rajasthan is hereby quashed and set aside.