Both Centre & states have power to legislate on GST: Supreme Court

The Supreme Court on Thursday held that both Centre as well as states have the power to legislate on Goods and Services Tax (GST) matters and that all recommendations of the GST Council are not binding on states but have only a persuasive value.

A bench presided by Justice D Y Chandrachud noted that the subject matter being taxation, both the Centre and states have the power to make laws on it. The court stressed the need for the GST Council to work harmoniously to achieve a workable solution.

The judgment which came on an appeal against a Gujarat High Court order also dwelt on aspects of federalism. “Indian federalism”, it said “is a dialogue between cooperative and non-cooperative federalism”, one in which “states and Centre always engage in a dialogue”.

The Supreme Court upheld the high court order quashing the central notification levying Integrated Goods and Services Tax (IGST) on importers on ocean freight.