Constitution Section 279A — Goods and Services Tax Council
Part XII — FINANCE, PROPERTY, CONTRACTS AND SUITS — General
Constitutional
Summary
The President must create the Goods and Services Tax Council within 60 days of the start of the 101st Amendment to the Constitution. The Council includes the Union Finance Minister as Chairperson, the Union Minister of State for Revenue or Finance as a member, and one minister from each state government (usually the finance or taxation minister). The state government members choose one of themselves as Vice-Chairperson for a period they decide.
The Council makes recommendations to the central and state governments on various GST-related matters, such as which taxes to include in GST, which goods and services to tax or exempt, model GST laws, tax rates, and special provisions for certain states. It also recommends when to apply GST to petroleum products like crude oil, diesel, petrol, natural gas, and aviation fuel.
The Council must work to create a uniform GST structure and a unified national market for goods and services. At least half of its members must be present for a meeting to be valid. Decisions require a three-fourths majority of weighted votes, with the central government having one-third weight and all state governments together having two-thirds weight.
The Council’s actions are not invalid just because of a vacancy, a defect in its formation, a problem with a member’s appointment, or a procedural mistake that does not affect the case. The Council must set up a way to settle disputes between the central government and states, or between states, that arise from its recommendations or their implementation.
Official Text
(1) The President shall, within sixty days from the date of commencement of the Constitution (One Hundred and First Amendment) Act, 2016, by order, constitute a Council to be called the Goods and Services Tax Council.
(2) The Goods and Services Tax Council shall consist of the following members, namely:—
(a) the Union Finance Minister — Chairperson;
(b) the Union Minister of State in charge of Revenue orFinance — Member;
(c) the Minister in charge of Finance or Taxation or any other Minister nominated by each State Government — Members.
(3) The Members of the Goods and Services Tax Council referred to in sub-clause (c) of clause (2) shall, as soon as may be, choose one amongst themselves to be the Vice-Chairperson of the Council for such period as they may decide.
(4) The Goods and Services Tax Council shall make recommendations to the Union and the States on—
(a) the taxes, cesses and surcharges levied by the Union, the States and the local bodies which may be subsumed in the goods and services tax;
(b) the goods and services that may be subjected to, or exempted from, the goods and services tax;
(c) model Goods and Services Tax Laws, principles of levy, apportionment of Goods and Services Tax levied on supplies in the course of inter-State trade or commerce under article 269A and the principles that govern the place of supply;
(d) the threshold limit of turnover below which goods and services may be exempted from goods and services tax;
(e) the rates including floor rates with bands of goods and services tax;
(f) any special rate or rates for a specified period, to raise additional resources during any natural calamity or disaster;
(g) special provision with respect to the States of Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand; and
(h) any other matter relating to the goods and services tax, as the Council may decide.
(5) The Goods and Services Tax Council shall recommend the date on which the goods and services tax be levied on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel.
(6) While discharging the functions conferred by this article, the Goods and Services Tax Council shall be guided by the need for a harmonised structure of goods and services tax and for the development of a harmonised national market for goods and services.
(7) One-half of the total number of Members of the Goods and Services Tax Council shall constitute the quorum at its meetings.
(8) The Goods and Services Tax Council shall determine the procedure in the performance of its functions.
(9) Every decision of the Goods and Services Tax Council shall be taken at a meeting, by a majority of not less than three-fourths of the weighted votes of the members present and voting, in accordance with the following principles, namely:—
(a) the vote of the Central Government shall have a weightage of one-third of the total votes cast; and
(b) the votes of all the State Governments taken together shall have a weightage of two-thirds of the total votes cast, in that meeting.
(10) No act or proceedings of the Goods and Services Tax Council shall be invalid merely by reason of—
(a) any vacancy in, or any defect in, the constitution of the Council; or
(b) any defect in the appointment of a person as a Member of the Council; or
(c) any procedural irregularity of the Council not affecting the merits of the case.
(11) The Goods and Services Tax Council shall establish a mechanism to adjudicate any dispute—
(a) between the Government of India and one or more States; or
(b) between the Government of India and any State or States on one side and one or more other States on the other side; or
(c) between two or more States, arising out of the recommendations of the Council or implementation thereof.