GST Council recommendations do not bind union and state governments – Supreme Court!

The recommendations of the GST Council do not restrict the Union and State Governments. Parliament and state legislatures have equal power to legislate on the Goods and Services Tax (GST) issue. The Supreme Court today ordered that the GST Council should provide appropriate advice.

The Union government has been battling with several importers that the integrated GST would apply to ocean freight.

In the case of Mohit Minerals regarding the Integrated Goods and Services Tax (IGST) levied on ocean freight, the Gujarat High Court has ordered in favor of the plaintiffs in revoking the IGST on ocean freight, saying that it is unconstitutional. The GST Council appealed to the Supreme Court against this.

When the case came up for hearing in a session chaired by Supreme Court Judge Chandrachud, the judges upheld the judgment of the Gujarat High Court.

Moreover, it is said, “democracy and federalism in India are interdependent. Section 246A treats the state and the union equally. Section 279 states that the state and the union cannot function independently of each other.

The GST Council may make suggestions and recommendations. But, the Union and State Governments cannot be compelled to do the same. The Union and State Governments have equal jurisdiction over laws in the matter of GST. If the GST Council’s recommendations do not govern the Union and state governments, it will affect the federal philosophy of the country”.

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