Case Law Details
Dharmendra M. Jani Vs Union of India and others (Bombay High Court)
Vide this petition challenge made in this writ petition is to the constitutionality of section 13(8)(b) and section 8(2) of the Integrated Goods and Services Tax Act, 2017.
Justice Ujjal Bhuyan while coming to the judgment of the Gujarat High Court in Material Recycling Association of India (supra), we find that Gujarat High Court while holding that section 13(8)(b) of the IGST Act cannot be said to be ultra vires or unconstitutional in any manner, however kept it open for the respondents to consider the representation made by the petitioner so as to redress its grievance in a suitable manner and in consonance with the CGST Act and the IGST Act.
He further opines that with utmost respect we are unable to accept the views of the Gujarat High Court as extracted above. Having regard to the discussions made in the preceding paragraphs it is evident that section 13(8)(b) of the IGST Act not only falls foul of the overall scheme of the CGST Act and the IGST Act but also offends Articles 245, 246A, 269A and 286(1) (b) of the Constitution. The extra-territorial effect given by way of section 13(8)(b) of the IGST Act has no real connection or nexus with the taxing regime in India introduced by the GST system; rather it runs completely counter to the very fundamental principle on which GST is based i.e., it is a destination based consumption tax as against the principle of origin based taxation.
Justice Ujjal Bhuyan further held that The other submissions made by Mr. Singh that levy of IGST on supply of services by intermediaries to foreign customers would strengthen the Make in India program by encouraging foreign investment can be no answer to challenge to constitutionality of a parliamentary statute. Besides such a statement has been made de-hors any supporting statistics and analysis. Therefore, the same cannot be of any assistance to the respondents.
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