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CA Intermediate · Taxation · GST in India - An Introduction

Under the Constitution (101st Amendment) Act, 2016, which of the following statements about the power to levy GST is correct?

Parliament has exclusive power for inter-State supplies, while Parliament and State Legislatures have concurrent power for intra-State supplies. This follows from Article 246A inserted by the 101st Amendment. The GST Council merely recommends and does not legislate, and States retain their power over intra-State supplies.

  1. AParliament has exclusive power to make laws on GST for inter-State trade or commerce, while Parliament and State Legislatures both have power for intra-State suppliesCorrect
  2. BState Legislatures alone may legislate on GST for inter-State supplies of goods
  3. CParliament alone may legislate on GST, including for intra-State supplies, as States gave up their powers completely
  4. DOnly the GST Council may enact laws on GST, as it replaced Parliament and the State Legislatures

Explanation

Article 246A gives Parliament and State Legislatures concurrent power to make laws on GST, but Parliament has exclusive power where the supply occurs in the course of inter-State trade or commerce. The GST Council only makes recommendations and does not enact laws. States did not surrender their power on intra-State supplies.

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