Page 203 - GSTL_2nd April 2020_Vol 35_Part 1

2020 ] HERO MOTOCORP. LTD. v. UNION OF INDIA 105
understand if the Petitioner has indeed suffered a setback, as it has presented
before us.
16. Having regard to the Constitutional Scheme with regard to the tax
structure that existed in the country prior to the promulgation of the CGST and
the IGST Acts, the same did not provide for any concurrent taxing powers to the
Union as well as the States. The powers of both the governments under the Un-
ion list and State list were clearly delineated. Therefore, in order to introduce
goods and Services Tax, the amendments to the Constitution of India were inevi-
tably required, with the aim of conferring simultaneous powers on the Parlia-
ment as well as the State Legislature, including every Union Territory, to make
laws for levying Goods and Services Tax on transaction of supply of goods, and
services, or both. Thus, the genesis of the GST is the 101st Constitution Amend-
ment, through which several amendments were introduced in the Constitution of
India. In this regard, the 2014 Amendment Bill proposed insertion of new provi-
sions i.e. Article 246A in the Constitution. The statement of objectives and rea-
sons laid down the rationale behind the introduction of said provision in the fol-
lowing words :
“The Constitution is proposed to be amended to introduce the goods and
Services Tax for conferring concurrent taxing powers on the Union as well
as the States including Union territory with Legislature to make laws for
levying goods and Services Tax on every transaction of supply of goods or
services or both. The goods and Services Tax shall replace a number of indi-
rect taxes being levied by the Union and the State Governments and is in-
tended to remove cascading effect of taxes and provide for a common na-
tional market for goods and services. The proposed Central and State
Goods and Services Tax will be levied on all transactions involving supply
of goods and services, except those which are kept out of the purview of the
Goods and Services Tax.“
17. Article 246A empowered both Centre and State to legislate and in-
troduce the Goods and Services Tax. Another crucial amendment is the insertion
of Article 269A which fundamentally alters the scheme of “Finance” provided in
Chapter-I of part-XXII of the Constitution. This is in fact, linked to Clause (2) of
[Article] 246A and provides for levy and collection of tax in the course of inter-
state trade and its appropriation between the Union and States. After the
amendment of the Constitution, and along the lines of the recommendation of
the GST Council, the Parliament in exercise of the powers conferred under the
newly introduced articles, enacted the Central Goods and Services Tax Act, 2017,
Union Territories Goods and Services Tax Act, 2017 and Integrated Goods and
Services Tax Act, 2017. Likewise, exercising powers under Clause (1) of Article
246A of the Constitution, the State Legislatures also enacted their respective State
Goods and Services Tax Legislations. Thus, Article 246A can be termed as the
most significant amendment carried out by the Constitutional Amendment Act,
as a result whereof, now both Parliament and State legislatures are competent to
concurrently legislate with respect to Goods and Services Tax. The dual GST
structure which empowers the Centre and the States to levy and collect taxes
through appropriate legislations is in conformity with the constitutional
schemes.
18. Under the new taxing scheme, various central indirect taxes includ-
ing the Central Excise Duty and several State indirect taxes have been subsumed
in GST. It is a destination-based tax, - i.e. Goods and Services are taxed at the
GST LAW TIMES  2nd April 2020  267