Article 246 Of The Indian Constitution

Part XI of Article 246 of the Indian Constitution lays forth the fundamental tenets that determine how central and state governments are to be divided into functional units. Legislative relations and administrative relations are the two chapters that make up this part.

The Constitution of India lays out legislative jurisdiction in two distinct lists: one for the Central Government, and another for the states. The leftovers are in the Center. This strategy is comparable to that set forth in the Canadian Constitution. The Australian Constitution served as a model for the Indian Constitution’s adoption of the Concurrent List.

This page provides you valuable insight into Articles 246 and 246A of the Constitution of India.

What Is Article 246 Of The Indian Constitution?

The subject of laws that can be passed by Parliament and state legislatures are covered under Article 246 of the Indian Constitution. The constitutional provisions of the Article stated before are outlined in the following 4 Clauses:

1. Despite what is stated in clauses (2) and (3), Parliament has the exclusive authority to frame laws with respect to any of the issues included in List I of the Seventh Schedule, often known as the “Union List” in this Constitution.
2. In spite of whatever may be said in clause (3), both Parliament and, so long as clause (1) is adhered to, the legislature of any state is able to make laws pertaining to any of the topics that are listed in List III of the Seventh Schedule (which is referred to as the “Concurrent List” in this Constitution).
3. Subject to clauses (1) and (2), the legislature of any state has the exclusive power to establish laws for that state or any portion thereof with regard to any of the issues mentioned in List II of the Seventh Schedule (referred to as the “State List” in this Constitution).
4. Regardless of whether a particular issue is one that is listed in the State List, Parliament has the authority to pass legislation pertaining to that issue for any area of Indian territory that is not incorporated in a State.

What Is Article 246A Of The Indian Constitution?

The specific provisions relating to the Goods and Services Tax (GST) in India are covered in Article 246A. Following are the two Clauses outlining the constitutional provisions of the aforementioned Article:

1. In spite of the provisions of articles 246 and 254, Parliament and, subject to clause (2), the legislature of each State have the authority to pass laws governing the goods and services tax levied by the Union or by that State.
2. Parliament has the exclusive authority to frame laws governing goods and services taxes where the supply of products, services, or both occur in the course of inter-State trade or commerce.

Explanation — In relation to the goods and services tax mentioned in clause (5) of article 279A, the provisions of this article shall go into effect on the day that the Goods and Services Tax Council recommends.

Scope Of The Phrase “With Respect To” In Article246A

Both P and SL have the authority to formulate laws “with respect to” the GST that applies to intrastate supplies, as stated in Article 246A (1) of the Constitution. The long-standing legal precedent suggests that making incidental provisions to facilitate tax collection is part of the authority to create laws with regard to a subjected tax, among other things. However, it’s crucial to determine whether the phrase “with respect to” is broad enough to encompass the authority to make an arrest or impose a fine with regard to GST offense(s) or if such extreme measures are not covered by it.

Which Amendment Has Inserted Article 246A?

The Union List and the State List are lists found in the Constitution that grant the Center and the States, respectively, the authority to collect separate taxes. In order for the Center and the States to have the authority to tax and collect GST, it has to be levied in a specific method. Additionally, the legislation had to be uniform across the State/Union Territory Legislatures and the Center. There ought to be a constitutional amendment to account for this.

The 101st Amendment to the Constitution of India, which was passed in 2016, inserted Article 246A into the Constitution and it went into force on September 16th of that same year. Article 246A deals with the special provisions regarding the Goods and Services Tax (GST) in India.

Article 246 and Article 246A are mutually exclusive

Along with adding Article 246A, the 101 CAA also eliminated or limited the scope of a few entries in the Seventh Schedule. After revision, Entry 54 of List II in the Seventh Schedule only allows for the assessment of sales tax on five petroleum goods. The question of whether the State can tax all other products under the guise of exercising its authority under Article 246A is an intriguing one.

The phrase “products and services tax” is used in Article 246A(1), and for convenience or otherwise, the phrase is defined in Article 366 (12A) as “any tax on supply of goods, or services, or both, save taxes on supply of alcoholic liquor for human use.” From a combined interpretation of both, it appears that Article 246A truly gives the government the authority to impose taxes on the supply of goods and services, with GST serving solely as a substitute.

Naturally, under Article 246A, State legislatures would be able to impose sales tax if supply is interpreted to include the occurrence of a sale. However, isn’t the ability to tax [sell] already being used because of the SGST Act’s ability to tax supply?

If the Constitution allows for the adoption of two distinct laws based on the same power, it would explain how the Medicinal and Toilet Preparations Act of 1955, which imposed a simultaneous excise duty in addition to the ordinary excise duty on Medicinal and Toilet preparations, survived and was followed by many more laws of a similar nature.

It is crucial to make reference to the Hon’ble Gujarat High Court decision in Reliance Industries Limited, where it was (rationally) noted that the authority granted by Article 246A cannot be divided in order to levy tax on the sale of products.

It is crucial to make reference to the Hon’ble Gujarat High Court decision in Reliance Industries Limited, where it was (rationally) noted that the authority granted by Article 246A cannot be divided in order to levy tax on the sale of products. Consequently, one can draw the conclusion that even while Article 246A does not comply with Article 246, the two articles are, to an extremely great extent, mutually exclusive to one another. To avoid the ludicrous liability imposed by the GVAT Amendment Act, the Court was formulating a counterargument, therefore we must exercise caution before interpreting the ruling as law.

Conclusion

The State Legislatures may pass laws on matters included in the State List, whereas the Union Parliament may pass laws on matters listed in the Union List. The power to legislate on topics that are included on the Concurrent List has been delegated jointly to the Union Parliament as well as to the legislatures of the individual states. Additionally, the Union Parliament was given the authority to pass laws on topics not included in any of the three lists.

In terms of the core foundation of the GST in India, Article 246A is without a question the most significant provision. The established historical principles appear to be at odds with the present power in some way. Trying to address the disagreements over competence amongst the legislative bodies, unintentionally creates cross-sectional disagreements. Examining what we sought to gain and what we did gain may be the ideal approach to Article 246A (or, for that matter, the entire 101 CAA). If Article 246A introduces absurdities that were not intended (such as double jeopardy and cross-sectional powers), a reading that avoids these errors should be upheld.

In the interest of further readings:

Article 248 Of The Indian Constitution (Residuary powers of legislation)	Article 245 Of The Indian Constitution
Article 244 Of The Indian Constitution	7th Schedule Of The Indian Constitution

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