Q1. With reference to the Goods and Services Tax (GST) Council and the proposed GST compliance reforms, consider the following statements:
- The GST Council is a constitutional body established under Article 279A of the Constitution.
- Recommendations of the GST Council are legally binding on Parliament and State Legislatures in all circumstances.
- GST is a destination-based tax, under which revenue is generally intended to accrue to the jurisdiction where goods or services are consumed.
- The proposed restriction on inter-State goods inspections seeks to strengthen procedural safeguards by requiring specific intelligence and authorisation for interception.
How many of the statements given above are correct?
(a) Only one
(b) Only two
(c) Only three
(d) All four
Answer: (c)
Explanation:
- Statement 1 is Correct: Article 279A provides for the GST Council, which includes Union and State representatives.
- Statement 2 is Incorrect: In Union of India v. Mohit Minerals Pvt. Ltd. (2022), the Supreme Court held that GST Council recommendations have persuasive value and are not binding on Parliament and State Legislatures.
- Statement 3 is Correct: GST follows the destination principle, linking taxation to consumption rather than merely the place of production.
- Statement 4 is Correct: The proposed safeguards aim to limit arbitrary interception and improve accountability in inter-State goods movement.
