Clearing the air regarding applicability of the recent notifications related to GST law, the finance ministry said there is no “legal infirmity” in the notifications issued for the Constitution (One Hundred and First Amendment) Act, 2016.
Questions had been raised by some after the Centre notified certain provisions in the GST law with effect from September 16, stating that the government under amended entry 84 will levy excise duty only on goods such as petroleum crude, aviation turbine fuel, natural gas, high-speed diesel and tobacco products.
Revenue secretary Hasmukh Adhia said that there is no legal requirement for any further clarification or notification in this regard.
His statement comes a day after he posted on Twitter that questions had been raised regarding the amendments and necessary clarification may be issued, if needed.
“DoR (department of revenue) examined the validity and implications of notifications dated September 10 and 16 with respect to existing taxes imposed by the Union and states. There is no legal infirmity in these notifications,” Adhia tweeted.
He further said the law department has confirmed that “there appears to be no legal requirement to issue any further clarification or notification in this regard”.
The confusion regarding the amendments pertained to whether excise duty can be levied on all goods by Centre till the rollout of GST, which will subsume excise duty and service tax.
Some tax experts are of the view that the notifications are legally correct as the Centre under entry 97 of the Union List has the power to levy taxes on goods which are not mentioned in any List under the Seventh Schedule of the Constitution.
Entry 97 states that Centre can levy tax for “any other matter not enumerated in List II or List III including any tax not mentioned in either of those Lists.”
List II under the Seventh Schedule of the Constitution deals in subjects on which states have exclusive legislative powers while
List III is the concurrent list for legislative matters pertaining to both the Centre and the states.