Goods and Services Tax – GST – By: – Ranjan Mehta – Dated:- 22-9-2016 Last Replied Date:- 26-9-2016 – Prelude:- Model GST law is in public domain since June 2016, President has given his assent to 101st Constitution Amendment Act, 2016 giving Central and State Govts power to levy GST on 08th September, 2016. However, till then there was nobody talking about the Excise Duty and its existence. GST has not yet been rolled out. Even the law is under preparation as yet. Then suddenly on 16.09.2016 what happened that everybody seems to be talking about it. Revenue secretary Mr. Hasmukh Adhia is tweeting one after another. So the big question as of now is that what happened which lead to such controversy and why everybody is discussing the very constitutional validity of Excise and Service Tax. The answer lies with the notification dated 16th September, 2016 which notified the 19 sections of the Constitution (One Hundred and First Amendment) Act, 2016. Notification:- Central Govt on 16.09.20
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of this entry the Central Government was allowed to levy excise on all the goods manufactured or produced in India. Now the new entry substituted by Constitution (One Hundred and First Amendment) Act, 2016 is as follows:- 84. Duties of excise on the following goods manufactured or produced in India, namely:- (a) petroleum crude; (b) high speed diesel; (c) motor spirit (commonly known as petrol); (d) natural gas; (e) aviation turbine fuel; and (f) tobacco and tobacco products. ; This new entry substituted in place of earlier one which entitles Central Govt to levy Excise on these 6 items only. There is no entry in the Central list, which directly enable the Central Govt to levy duty of excise on goods other than the 6 mentioned above. Govt. response to the Controversy Ending days of confusion, the government has clarified that the notification of the provisions of the Constitution amendment Act for the goods and services tax (GST) does not take away the power of the central government t
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response correct ? Govt response keeping section 19 in the forefront of all the controversy is challengeable. This section 19 talks about laws in force in any state. Not in the whole India. Thus there is a view that this provision does not cover central levies. However the second leg of this section comes to save the Govt view once again, which says that earlier provisions shall continue to be in force until amended or repealed by a competent legislature or other competent authority. Thus this means that the laws amended by this Act shall not be amended so until such laws are repealed or one year elapses since the commencement of this act i.e. w.e.f. 15.09.2017 they shall automatically be repealed if not done so specifically. Further, there is another entry No. 97 to the Union List, which is a residuary entry in that list 97. Any other matter not enumerated in List II or List III including any tax not mentioned in either of those Lists. The Govt can also contemplate to include levy of
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give central Govt absolute power to levy service tax which read as follows:- 268A 1) Taxes on services shall be levied by the Government of India and such tax shall be collected and appropriated by the Government of India and the States in the manner provided in clause (2). (2) The proceeds in any financial year of any such tax levied in accordance with the provisions of clause (1) shall be- (a) collected by the Government of India and the States; (b) appropriated by the Government of India andthe States, in accordance with such principles of collection and appropriation as may be formulated by Parliament by law. This article 268A is also deleted by sec 7 of Constitution (101st) Amendment Act, 2016. The website of the CBEC also displays the above 2 provisions to establish the constitutional validity of service tax law. From the above discussion we can feel that due to deletion of these 2 provisions Service Tax will also be in peril like in case of Excise. BUT there is a technical glitc
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