SC: Govt Not Obligated to Run Old Exemption Policies After GST Act

The Apex court, post to the enactment of the Central Goods and Services Tax Act in 2017, the centre was not being restricted to carrying on with its pre-existing 100% outright excise duty exemption policy of 2003 for publicizing the activities of industries in some of the states like Uttarakhand and Sikkim where it is little or no industry.

Justices B R Gavai and B V Nagarathna refused the appeals of Hero Motocorp and Sun Pharma Laboratories Ltd, which had plants in Uttarakhand and Sikkim correspondingly, opposes on the concern of the lower advantage of 100% GST exemption in excise duty to 58% beneath the new Goods and service tax regime. The Apex court allowed the two firms to make the representations to the corresponding state government along with the GST council.

We had requested the state government along with the GST council to acknowledge the same representations when it has incurred as per the observance in an expeditious way, the 73-page judgment has been written by Justice Gavai. The same would be mentioned that GST officials would be the constitutional body. The same is empowered to make suggestions on various problems related to GST along with the grant of exemptions via Goods and service tax. The same would be secured with the power to make recommendations concerning special provisions governing North Eastern and the Himalayan States, it expressed.

The bench and various industrial units would be installed in the Himalayan and Northeastern states in pursuance of the 2003 office memorandum in which various people are being employed under these industries. It shall be effective for the states related to acknowledging the reimbursing these units. The bench referred to the judgments on the scope of the judicial review of these policy decisions of the government. The appeal of the promissory obstruct will not be available with respect to the practice of the legislative operations of the state. The same would not be applicable to prevent the government from releasing its operations beneath the law.

The revision of policy shall be acknowledged which shows public interest or in view of the change in the statutory regime itself on account of the GST Act being introduced as in the instant case, the same would not be correct to hold the Union bound by the representation made by it, i.e. by the said O.M. of 2003. Further, the same shall be opposite to the regulatory provisions as enacted under Section 174(2)(c) of the CGST Act.

The appeals of Hero Motocorp and Sun Pharma Laboratories Ltd against the decrease in exemption of duty were disregarded Delhi High Court and the Sikkim High Court respectively.

As per the statement made by the Prime Minister in 2003, the central government furnished that some states engaging Uttarakhand in the new industrial units along with the existing industrial units on their substantial expansion would be entitled to exemption of 100% outright excise duty for 10 years from the date of the beginning of commercial production.