GST Council’s Proposals:
The Supreme Court, in a judgment championing the importance of “cooperative federalism”, held that Union and State legislatures have “equal, simultaneous and unique powers” to make laws on Goods and Services Tax (GST) and the recommendations of the GST Council are not binding on them.
- The apex court’s decision came while confirming a Gujarat High Court ruling that the Centre cannot levy Integrated Goods and Services Tax (IGST) on ocean freight from Indian importers.
- The court emphasised that Article 246A (which gives the States power to make laws with respect to GST) of the Constitution treat the Union and the States as “equal units”.
- It confers a simultaneous power (on Union and States) for enacting laws on GST.
- Article 279A, in constituting the GST Council, envisions that neither the Centre nor the States are actually dependent on the other.
- The judgment said that though the Centre may have a larger share of power in certain instances to prevent chaos and provide security, the States still wielded power.
- After all, the court said, “Indian federalism is a dialogue between cooperative and un-cooperative federalism where the federal units are at liberty to use different means of persuasion, ranging from collaboration to contestation”.