Justice DY Chandrachud of the Supreme Court said on Thursday that articles, written on his judgement, which held that the GST council’s recommendations are not binding on the Parliament and state legislatures, had “intrigued” him.
Justice Chandrachud was referring to the ruling in Union of India vs Mohit Minerals, which concluded that the GST Council’s recommendations could not bind the legislative authorities of the Union and States. Both the Union and the States have simultaneous legislative rights on GST, according to Article 246A of the Constitution.
“246A treats state and centre as equal. Article 279 says state and centre cannot act independent of each other. This also points towards competitive federalism,” said Justice DY Chandrachud.
19.05.2022 | Hon’ble Supreme Court’s one more wonderful Judgment out.. UoI v. Mohit Minerals !! Interesting observations by Justice DY Chandrachud that 246A treats state and centre as equal. Article 279 (1/2) #India #Tax #gst #SupremeCourt #incometax pic.twitter.com/8Hl6VZur5C
— Office of Shree Tax Chambers (@prabhakarks2017) May 19, 2022
According to a report by Livelaw, Justice made this statement while addressing Senior Advocate Harish Salve about a petition filed by Jindal Mining Group against the State of Odisha’s GST demand. “I am intrigued by the articles being written on the different facets of the judgment…Articles are being written on aspects like cooperative federalism etc. I hope you have read the judgement,” he told Salve, adding that “Ultimately we ruled on the aspect of composite supply.”
The court noted that the GST Council’s unequal voting structure – the Centre has 1/3 of the votes and the States have the remaining 2/3 – can be an outlet for “political contestation” between the Centre and the States, especially if different parties are in power.
Justice DY Chandrachud: 246A treats state and centre as equal. Article 279 says state and centre cannot act independent of each other. This also points towards competitive federalism. #GST #SupremeCourt
— Bar & Bench (@barandbench) May 19, 2022
The interdependence of democracy and federalism is apparent. Although the Indian Constitution mandates a bigger amount of power for the union to avert instability, the relationship between the two constitutional bodies is not always cooperative, said the court, adding “…therefore, the GST Council is not only an avenue for the exercise of cooperative federalism but also for political contestation across party lines. Thus, the discussions in the GST Council impact both federalism and democracy.”
