New Delhi, Nov 8: Maintaining that the proposed Goods and Services Tax (GST) regime is the most progressive tax reform, Minister for Finance and Ladakh Affairs, Abdul Rahim Rather today said that the state government is a strong votary to the implementation of this tax reform provided the special status guaranteed to J&K by the Constitution of India not tempered with.
 Speaking at a meeting of the Empowered Committee (EC) held at Vigyan Bhawan, New Delhi under the chairmanship of Union Finance Minister, P. Chidambaram today, Rather said that before implementation of the proposed GST in the country, appropriate provisions should be incorporated in the proposed Amendment Bill to provide protection under Article 246-A, 279-A and 286-A to the existing special constitutional status of Jammu and Kashmir.
 Dwelling on the constitutional and legal implications of the proposed GST regime, Rather said there are at least two features which are of most serious concern for Jammu and Kashmir.
 “Firstly, to accommodate the proposed dual integrated model of GST, the amendment Bill envisages both Parliament and State Legislature to have concurrent powers to enact laws to Tax Goods and services. This is being done without taking cognizance of the special constitutional status of Jammu and Kashmir and the necessity to incorporate appropriate amendments in Article-246 of the Constitution of India.”
 “Secondly,” the Minister said, “the proposed amendment Bill envisages insertion of Article 279-A and Article 279-B for creation of two constitutional bodies viz. the  Goods and Services Tax Council and the Goods and Services Tax Dispute Settlement Authority. The former would be a forum to take decisions with regard to the frame-work of GST so as to ensure uniformity and avoid deviations, whereas the latter would mainly adjudicate disputes and complaints pertaining to the implementation of GST vis-à-vis recommendations of the Goods and Services Tax Council.”
 He said as a matter of fact the division of powers between the Union of India and the State of Jammu and Kashmir is not on the same footing as it is in respect of other States of the Union. The State of Jammu and Kashmir enjoys special status under the Constitution of India and its Constitutional relationship with the Union of India is governed by Article 370 of the Constitution of India.
 Rather said, the union list and the concurrent list of the Seventh Schedule of the Constitution of India as applicable to Jammu and Kashmir are not the same as the Union List and the Concurrent List applicable to rest of the States of the Union.
 While making Seventh Schedule applicable to the State of J&K, the State List has been completely omitted and certain entries of the Union and the Concurrent lists have been omitted.  “As a corollary, Article 246 and Article 248 of the Constitution of India which govern the division of legislative powers between the Centre and the States apply in a modified form to the State of J&K,” he said.
 Whereas the tax laws of all other States draw their sanction from entry 54 of the State List of the Seventh Schedule of the Constitution of India, the tax laws of Jammu and Kashmir State are legislated by virtue of powers derived from Section 5 of the Constitution of Jammu and Kashmir which provides that the executive and legislative power of the State extends to all matters except those with respect to which Parliament alone has power to make laws for the State under the provisions of the Constitution of India. As such the Legislature of Jammu and Kashmir is competent to enact laws for taxing sales which are not only sales simpliciter but also the sales which are indivisible in character.

Lastupdate on : Thu, 8 Nov 2012 21:30:00 Makkah time
Lastupdate on : Thu, 8 Nov 2012 18:30:00 GMT
Lastupdate on : Fri, 9 Nov 2012 00:00:00 IST