The Constitution (101st Amendment Act) 2016 for implementation of GST in India

1. The Constitution (101^st Amendment Act) 2016.

1.1.It is containing 20 Sections.

1.2.Article 279 A, a newly inserted Article for setting up GST Council

Note: 1. The same is notified on 12 September 2016

Note: 2. Remaining provision is notified on 16 September 2016

1.3.         Compensation to state for loss of revenue by The Central Government for a period of 5 Years on recommendation of Council.

1.4.Formation of Joint forum by State and Central Govt. i.e. The GST Council.

Note: 1. Provision comes into effect from 12 September 2020.

Note: 2. Council is constituted on 15 September 2020.

1.5.         Finance Minister is the chairman of the council and other ministers of States are members.

1.6.         Council makes recommendation to the State Govt. on different issues.

1.7.         Declared Goods of Special Importance has been done away. Instead certain restrictions are placed on State Government with regard to such goods.

1.8.         Transitional provision to take care of inconsistency of provision in any States. Such State laws will remain effective until amendment in Central GST is made or one year from the end of the commencement of such state law, whichever is earlier.

1.9.         Article 248:

i)               Residuary power is granted to the Parliament to make Law for any matter which is not in the concurrent list of State.

ii)             Power to make laws to impose tax by Central Govt. or State Govt. is subject to Article 246A.  

1.10.         Article 249:

i)               Power to make laws by the Parliament with respect to items in the State List for the Interest of Nation.

ii)             Now the power has been extended to GST.

Note: 1. In such situation the council of the state has to pass resolution by not less than Two Third of the members.

1.11.         Article 250:

i)               Power of Parliament of making law for items mentioned in state list in case of Emergency.

ii)             Now the power has been extended to GST.

1.12.         Article 268: Duties levied by Central Government but Collected and appropriated by State Government.

i) Excise duty on medical and toilet preparation has been omitted in Article 286. Such excise duty has been subsumed into goods and service tax to be levied, and collected by Central and state

           1.13.    Article 268 A: Service Tax: 

i) It empowers the Central  Government to levy service tax in 1994. Under residual Entry 97. 

ii)  268A, was inserted by 88th  Constitutional Amendment Act. 2003, under a separate Entry 90C.

 

iii)this article has been omitted now.

 

1.14 Article 269A:  GST on Interstate supply.

 

i) Newly inserted

 

ii) Levied, and collected by Central Government, and apportioned between Central and State Government.

 

ii) Imports shall be deemed as interstate supply. 

 

iii) Such collected tax shall not be part of consolidated fund of India.

 

iv) IGST will be levied, in place of countervailing duties, under the Customs Tariff Act, 1975.

 

v) IGST When used to pay SGST such payment should not part of consolidated fund of India.

 

VI) determination of particulars of place of supply in case of Interstate supply. 

 

1.15. Article 270:  Distribution between Central Government and State Government by amendment of Article 270.

 

1.16. Article 271: 

 

i) It empowers Parliament to increase any duty or tax referrd to Article 269 or 270.

 

ii) Now, is GST is excluded from the purview.

 

1.17 Article 366:  Definition of GST (Article 366(12A)), Service and State

 

i) Definition of GST: Tax on supply of goods or services, excluding liquor for human consumption.

 

ii) Article 366(26A): Service, other than goods.

 

iii) Article 366(26B): State with reference to Article 246A, 268, 269, 269A, 279A includes union territory.

1.17. Article 366 (12): Goods includes all material commodities and articles.

1.18.  Article 286:  Restriction of tax on supply of goods.

1.  State has no authority to tax on transactions accrued outside the states.

2.  Also on imports.

3.  Amendment has been made to effect GST for similar transaction.

1.19  Article 279A: Constitution of council that is GST Council.

1. Chairman of the council will be The Finance Ministers

2. Union Minister of State, in charge of revenue in charge of Revenue or Finance will a member.

3.  Minister in charge of finance / taxation or any other minister nominated by state will be members.

4. Vice chairman will be selected among the members.

5. The Council shall make recommendations on:

i) The tax or cess to be subsumed.

ii) Goods or Service which will be subjected / exempted.

iii) Model law, principles and apportionment.

iv)Threshold limit.

v) Floor rates.

vii) Special rate to manage additional resource in natural calamity.

viii) Provision relating to special category states.

ix) Other methods.

6. Council shall recommend date from which tax on

i)  Patrolium

ii) high speed diese

iii) Motor spirit, Natural gas, Aviation Turbine Fuel( ATF)

7.  Development of harmonized national market.

9.  Qorum shall be 50% of member.

10.  Determination of procedure.

11. Decisions shall be bound by three fourth (3/4) of the members.

1.    Central one third

2.    State to 2/3 rd

3.     No, act of counsel shall be invalid merely by the reason that::

Defect of constitution of council.

Defect in appointment of members.

Procedural irregularities

4.    Adjudication mechanism between Central, and State Government.

             1.18.        Article 386 is amended: Now to make amendment

1.      Inclusion of Section inclusion of article 279.

2.      By 2/3 rd of each home of Parliament

            3.      One third of the state.