Government Cannot Travel Beyond GST Council Recommendations While Issuing Notifications Under Sections 9 & 11 of the CGST Act: Madras HC Reinforces Constitutional Limits on Delegated Legislation
Summary: The Madras High Court, in its judgment dated 15 June 2026, held that the Government cannot issue notifications under Sections 9 and 11 of the CGST Act that go beyond the recommendations of the GST Council. The dispute arose after the Government, while issuing GST notifications on branded food products, inserted the additional expression “enforceable right in a court of law,” which was not part of the GST Council’s recommendation. The Court ruled that such notifications constitute delegated legislation and must strictly adhere to the parent statute and Article 279A of the Constitution. Relying on the Supreme Court’s decision in Mohit Minerals, the Court clarified that although GST Council recommendations are not binding on Parliament for primary legislation, they are binding limits for executive notifications issued under statutory delegation. It also held that the GST Council cannot retrospectively ratify an invalid notification. The judgment reinforces constitutional limits on executive taxation powers and strengthens taxpayer protection against excessive delegated legislation.
Introduction
The Madras High Court, in M/s Guru and Co. & Others v. Union of India & Others (Judgment dated 15.06.2026), has delivered a landmark judgment that will have far-reaching consequences for GST administration across India.
The Court has unequivocally held that while issuing notifications under Sections 9 and 11 of the CGST Act, the Government cannot enlarge or modify the recommendations of the GST Council. If a notification travels beyond the recommendation made by the GST Council, such notification is liable to be declared ultra vires the Constitution and the CGST Act.
Although the controversy in this case related to taxation of branded food products, the legal principles laid down by the Court have much wider implications for every taxpayer and every notification issued under the GST law.
Background of the Dispute
Under the original GST Notifications dated 28 June 2017, GST at the rate of 5% was applicable only to goods supplied in unit containers bearing a registered brand name.
Several businesses thereafter voluntarily deregistered their trademarks while continuing to market their products under the same brand names, thereby claiming exemption.
To address this issue, the GST Council, in its 21st Meeting held on 9 September 2017, recommended that the expression “registered brand name” should also include brands in respect of which an actionable claim was available.
However, while issuing Notification Nos. 27/2017-Central Tax (Rate) and 28/2017-Central Tax (Rate) dated 22 September 2017, the Central Government added an additional expression:
“Enforceable right in a court of law.”
This phrase was never recommended by the GST Council.
Based upon this enlarged notification, Show Cause Notices were issued to various taxpayers.
The validity of these notifications was challenged before the Madras High Court.
Core Legal Issue
The principal question before the Court was:
Can the Government, while exercising delegated legislative powers under Sections 9 and 11 of the CGST Act, issue a notification that goes beyond the recommendation made by the GST Council?
A connected question also arose:
Can the GST Council subsequently ratify such notification and thereby validate an otherwise invalid delegated legislation?
Statutory Framework
The controversy involved interpretation of:
- Section 9 of the CGST Act
- Section 11 of the CGST Act
- Article 279A of the Constitution of India
- Doctrine governing delegated legislation
Both Sections 9 and 11 expressly require that notifications be issued “on the recommendations of the GST Council.”
Findings of the High Court
The Madras High Court answered both questions against the Government.
The Court held that notifications issued under Sections 9 and 11 constitute subordinate (delegated) legislation.
Unlike Parliament, which enjoys plenary legislative powers, the Executive can exercise only such powers as are delegated by the parent statute.
Consequently, while issuing notifications, the Government cannot:
- modify,
- enlarge,
- alter,
- expand, or
- substitute
the recommendations of the GST Council.
Reliance on Mohit Minerals
The Court extensively relied upon the Constitution Bench judgment of the Supreme Court in: Union of India Vs Mohit Minerals Pvt. Ltd. (Supreme Court of India)
The Supreme Court had clarified that:
- GST Council recommendations are not binding upon Parliament or State Legislatures while enacting primary legislation.
However,
When the Government exercises delegated legislative powers, it must remain within the framework prescribed by the parent statute.
Since Sections 9 and 11 themselves require recommendations of the GST Council, the Government cannot exceed those recommendations while issuing notifications.
This distinction between primary legislation and delegated legislation forms the foundation of the judgment.
Why the Notification Was Declared Invalid
The Court compared:
GST Council Recommendation
Actionable Claim
with
Government Notification
Actionable Claim plus Enforceable Right in a Court of Law
The Court found that:
- The second expression substantially enlarged the scope of taxation.
- Such enlargement had never been approved by the GST Council.
- Therefore, the Government exceeded its delegated authority.
- Accordingly, the additional expression was declared ultra vires the CGST Act as well as Article 279A of the Constitution.
Ratification by GST Council Rejected
The Government attempted to justify the notification by relying upon the 22nd GST Council meeting, where the notification was allegedly ratified.
The Court rejected this contention.
It held that:
- The GST Council possesses constitutional authority only to make recommendations.
- Neither the Constitution nor the CGST Act confers any power upon the Council to retrospectively validate or ratify an invalid notification already issued by the Government.
- A statutory defect cannot be cured merely through subsequent ratification unless the law expressly authorises such ratification.
Constitutional Significance
This judgment strengthens several constitutional principles.
1. Rule of Law
Executive authorities cannot enlarge taxation through administrative notifications.
2. Delegated Legislation
Delegated legislation cannot travel beyond:
-
- parent statute,
- constitutional limitations,
- delegated authority.
3. Article 279A
Recommendations of the GST Council constitute the outer boundary within which notifications under Sections 9 and 11 must operate.
4. Separation of Powers
The Executive cannot assume legislative powers that Parliament itself has not delegated.
Practical Impact on Taxpayers
Although this case concerns branded food products, its implications extend much beyond the facts.
Taxpayers can challenge notifications where:
- additional conditions are inserted;
- exemptions are curtailed beyond Council recommendations;
- tax liability is expanded by executive action;
- delegated legislation exceeds statutory authority.
Wider Application Under GST
The ratio of this judgment may be relevant in disputes concerning:
- Classification notifications
- Exemption notifications
- Reverse charge notifications
- Composition Scheme notifications
- Rate notifications
- Valuation notifications
- Procedural notifications affecting substantive rights
Whenever a notification travels beyond what was recommended by the GST Council, its legality can now be questioned.
Important Legal Principle
The Court has reaffirmed an important constitutional doctrine:
The Government cannot legislate through notifications.
Notifications are intended only to implement the law—not to create new liabilities or enlarge the charging provisions.
Lessons for GST Administration
The judgment serves as an important reminder that:
- Executive convenience cannot override statutory limits.
- Delegated legislation must remain faithful to the parent Act.
- GST Council recommendations cannot be modified unilaterally by the Government.
- Administrative innovations cannot impose tax without legal authority.
Conclusion
The judgment of the Madras High Court represents a significant reaffirmation of constitutional governance under the GST regime.
While Parliament possesses the authority to amend the CGST Act, the Executive does not enjoy similar freedom while issuing notifications.
Once Parliament has mandated that notifications under Sections 9 and 11 shall be issued on the recommendations of the GST Council, the Government must faithfully implement those recommendations and cannot enlarge, modify or supplement them.
The decision not only protects taxpayers from excessive delegated legislation but also reinforces the constitutional balance envisaged under Article 279A.
For taxpayers, professionals and tax administrators alike, this judgment reiterates a timeless constitutional principle:
“The power to issue a notification is a delegated power; it is not a licence to legislate.”
Key Takeaways
– Notifications under Sections 9 and 11 are subordinate legislation.
– The Government cannot travel beyond GST Council recommendations.
– GST Council has no power to retrospectively ratify an invalid notification.
– Delegated legislation cannot enlarge the charging provisions of the Act.
– Any notification exceeding the recommendation of the GST Council is liable to be declared ultra vires.
– The judgment strengthens constitutional control over executive taxation powers and is likely to influence future GST litigation involving notifications, exemptions and delegated legislation.
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