In the realm of Goods and Services Tax (GST) regulations, the vires of section 13(8)(b) and section 8(2) of the Integrated Goods and Services Tax Act, 2017 (IGST) have been subject to significant debate and legal scrutiny. This article delves into the complexities surrounding these sections, explores the contrasting opinions of the judiciary, and provides comprehensive insights into the constitutionality of these provisions.
Judicial Perspectives on Section 13(8)(b) and Section 8(2)
The controversy surrounding section 13(8)(b) and section 8(2) of the IGST Act has been a matter of contention among legal experts. On 9th June, 2021, Hon’ble Shri Justice Ujjal Bhuyan, in his judgment on Writ Petition No.2031 of 2018, deemed section 13(8)(b) ultra vires and unconstitutional. The court declared that the provision goes against the framework established by the IGST Act.
Conversely, in the same case, one of the judges, Abhay Ahuja, J., held section 13(8)(b) and section 8(2) constitutionally valid. Justice Ahuja stated that these provisions are in accordance with the IGST Act, CGST Act, and MGST Act. He emphasized that section 13(8)(b) does not violate Section 9 of the CGST Act, 2017, or the MGST Act, 2017.
Similar views were also expressed in Writ Petition (L) No.639 of 2020, where the constitutionality of section 13(8)(b) was challenged. The court, with Abhay Ahuja, J., leading the opinion, upheld the validity of both section 13(8)(b) and section 8(2) of the IGST Act.
Difference of Opinion and Referral to a Third Judge
Due to the conflicting judgments, the Division Bench (consisting of Hon’ble Shri. Justice Ujjal Bhuyan and Hon’ble Shri. Justice Abhay Ahuja) referred the matter to the Chief Justice for resolution. The difference of opinion on the constitutionality of section 13(8)(b) led to a further examination of the provisions.
The Chief Justice referred the case for the opinion of a third judge, Hon’ble Shri. Justice G.S. Kulkarni. On 18th April, 2023, Justice Kulkarni rendered his opinion, holding section 13(8)(b) and section 8(2) of the IGST Act as legal, valid, and constitutional. However, he specified that these provisions should be confined to the operation of the IGST Act and not extend to the levy of tax under the CGST and MGST Acts.
Final Pronouncement and Dismissal of the Petitions
Subsequently, the matters were placed before the Division Bench for the final judgment. Taking into consideration the opinions of Justice Kulkarni and Justice Ahuja, the Division Bench concluded that section 13(8)(b) and section 8(2) of the IGST Act are indeed legal, valid, and constitutional.
With this pronouncement, the petitions challenging the vires of the said provisions were dismissed.