GST: Delhi High Court to hear petition challenging constitutional validity of certain provisions of the CGST Act, 2017 [Read Order]

GST: Delhi High Court to hear petition challenging constitutional validity of certain provisions of the CGST Act, 2017 [Read Order]

Delhi High Court - petition challenging constitutional validity - provisions of the CGST Act 2017 - Taxscan

The Delhi High Court to hear a petition challenging constitutional validity of certain provisions of the Central Goods and Service Tax (CGST) Act, 2017.

The petitioner, Sartaj Ali challenged the constitutional validity of certain provisions of the Central Goods and Services Tax Act, 2017.

It is the case of the respondents that a tax collection mechanism has been converted into a disbursement mechanism as if it were a subsidy scheme.

The Delhi High Court in a similar matter in Dhruv Krishan Maggu vs. Union of India & Ors. opined that the pith and substance of the CGST Act is on a topic, upon which the Parliament has the power to legislate as the power to arrest and prosecute are ancillary and/or incidental to the power to levy and collect goods and services tax.

Even if it is assumed that power to make offence in relation to evasion of goods and service tax is not to be found under Article 246A, then, the same can be traced to Entry 1 of List III. The term ‘criminal law’ used in the aforesaid entry is significantly wide and includes all criminal laws except the exclusions.

The Court prima facie founds force in the submissions on behalf of the respondent authority that the Central Tax Officers are empowered to conduct intelligence-based enforcement action against taxpayers assigned to State Tax Administration under Section 6 of the CGST Act.

The coram consisting of Justice Manmohan and Justice Asha Menon listed the matter before the roster Bench on 18th March 2021 along with the case of Dhruv Krishan Maggu vs. Union of India & Ors.

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