Recommendations of GST Council are not binding, says Supreme Court  

The Supreme Court on Thursday said that the recommendations of the GST Council are not binding on the Union and the states. Parliament intended the recommendation to have persuasive value, it said. The Parliament and state legislatures have simultaneous powers to legislate on GST, it said.

Recommendations of the GST Council are based on collaboration, the apex court added. It pointed out that Indian federalism is a dialogue between the Centre and the states.

The Supreme Court bench headed by Justice DY Chandrachud added that the role of the GST Council is significant but it does not pass a resolution unanimously. It must ideally function in a harmonised manner. Federal system needs harmonised work, it added. All units in a federal system depend on each other even if they are autonomous, the court said.

The apex court pointed out that Article 246A treats states and Centre as equal. Article 279A says state and centre cannot act independently of each other. This also points towards competitive federalism, it said.

The bench stated that Article 279A of the Constitution does not begin with a non-obstante clause and Article 246A does not envisage a repugnancy provision.

Making crucial observations on cooperative federalism, the court said, "Democracy and federalism is interdependent on each other. the Indian Constitution though necessarily federal provides union higher share of power to avoid chaos but relation between two constitutional units may not always be collaborative. Indian federalism is a dialogue in which state and centre always engages," the court added

The Supreme Court also upheld the decision of the Gujarat High Court, quashing the levy of IGST on ocean freight under reverse charge in the case of Mohit Minerals Private Limited.

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