The Supreme Court’s observation about “GST Council’s decisions to be not binding” could shake up the entire tax framework. Tax experts doubt that the centre or the state could use this reference whenever they have a disagreement with the decision of the GST Council. Thus, the implementation of law could become more challenging. In the worst case, states may actually end up having different tax regimes, and the concept of one nation one tax could be threatened.
Rajat Mohan, Senior Partner, AMRG & Associates opined that the Maharashtra state commissioner held that no circular of the Central Board of Indirect Taxes and Customs (CBIC) would be applicable to taxpayers in Maharashtra state in relation to SGST unless the same is passed by the state GST department and this rule of law has landed several taxpayers in a soup over several matters. In states like West Bengal, Maharashtra, Punjab and Chhattisgarh, where the state government is not in tandem with the central government, the state governments could use these precedents wherever required to pacify the law enforcement.
