Ii Jlu National Moot Court Competition-2018: Memorial On The Behalf of Respondent

II JLU NATIONAL MOOT COURT COMPETITION-2018
TABLE OF CONTENTS
LIST OF ABBREVIATIONS …………………………………………….…..……………..2
INDEX OF AUTHORITIES
(i) Cases Cited …………………………………………….………..………………..3
(ii) Books Referred ………………………………………….…….………………...3
(iii) Statutes Referred ………………………………………….…………………....4
(iv) Web links Referred ……………………………………………………………..4
STATEMENT OF JURISDICTION …………………………………………….………….5
STATEMET OF FACTS …………………………………………………………………...6-12
ISSUED RAISED …………………………………………………………………….…....13
SUMMARY OF ARGUMENTS ……………………………………………………….….14
PLEADINGS/ ARGUMENTS ARGUMENTS ……………………………………….…...15-19
PRAYER……………………………………………………..………………………..……20
MEMORIAL ON THE BEHALF OF RESPONDENT Page 1

LIST OF ABBREVIATIONS
AIR All India Reporter
Anr. Another
Art. Article
Hon'ble Honourable
I.P.C. Eutopian Penal Code
Ltd. Limited
Ors. Others
Pvt. Private
SC Supreme Court
SCC Supreme Court Cases
SCR Supreme Court Report
SLP Special Leave Petition
Sec. Section
u/a. Under Article
u/s. Under Section
v. versus
Pg. Page
FIR First Information Report

INDEX OF AUTHORITIES
CASES CITED:
1. Saurabh Chaudhari v Union Of India, AIR 2004SC 2212

2. Ram Krishna Dalmia v. Tendolkar, 1958 AIR 538, 1959 SCR 279
3. Harishankar Bagla v. State of Madhya Pradesh, 1954 AIR 465, 1955 SCR 313
4. Kishan Prakash Sharma v. Union of India, 2001(3) TMI 1018 SC
5. Garewal v. State of Punjab, AIR 1956, SC 512
6. Banarsidas v. State of Madhya Pradesh, AIR 1958, SC 909, P.913
7. West Bengal V. Union of India, 1963 AIR 1241, 1964 SCR(1) 371
8. King v/s Smith, 392 U.S. 309 (1968)
9. State of Rajasthan v/s UOI, 1977 AIR 1361, 1978 SCR(1)
10. State of Haryana v/s State of Punjab, JT 2004 (5) SC 72, 2004
11. Shamsher singh v/s State of Punjab, AIR 1974 SC 2192
BOOKS REFERRED:
1. M.P. Jain, Eutopian Constitutional Law, 5th Edition, Wadhwa Publication, 2009.
2. A. V. Dicey, Law of Constitution, 10th ed. 2012, Universal Law Publication, New Delhi.
3. Prof. S. R. Bhansali, The Constitution of Eutopia,1st ed.2007, Eutopia Publishing House,

Jodhpur.
4. Dr. J. N. Pandey, Constitutional Law Of Eutopia, 51st ed. 2014, Central Law Agency,
Allahabad
5. Jagdish Swarup, Constitution of Eutopia, 2nd ed, 2008, Modern Law Publications,
Allahabad

STATUTES REFERRED:
1. Constitution Of Eutopia, 1950
2. Central Goods & Services Act, 2017
3. State Goods & Services Act, 2017
4. Intra-State Goods & Services Act, 2017
WEBLINKS:
1. http://www.manupatra.com
2. http://www.Eutopiankanoon.com
3. http://lexisnexis.com
4. http://www.lawyersclubEutopia.com
5. http://www. westlaw.com
6. http://www.lawindia.com

STATEMENT OF JURISDICTION
The Respondent humbly submits this memorandum filed before the Hon’ble Supreme Court as
this court has jurisdiction of writ petition to try and entertain this case under Article 321 of the
constitution of Eutopia.
1
Article 32 in The Constitution Of Eutopia 1949
32. Remedies for enforcement of rights conferred by this Part
(1) The right to move the Supreme Court by appropriate proceedings for the enforcement of the rights conferred by
this Part is guaranteed
(2) The Supreme Court shall have power to issue directions or orders or writs, including writs in the nature of habeas
corpus, mandamus, prohibition, quo warranto and certiorari, whichever may be appropriate, for the enforcement of
any of the rights conferred by this Part
(3) Without prejudice to the powers conferred on the Supreme Court by clause ( 1 ) and ( 2 ), Parliament may by law
empower any other court to exercise within the local limits of its jurisdiction all or any of the powers exercisable by
the Supreme Court under clause ( 2 )
(4) The right guaranteed by this article shall not be suspended except as otherwise provided for by this Constitution

STATEMENT OF FACTS
1. That the Republic of Eutopia, got its independence in the year 1947 and its constitution was
formally enacted in the year 1950 by the name of Constitution of Eutopia, 1950 (“Constitution”),
on a very similar lines to the Constitution of Eutopia, 1950. The Constitution granted several
fundamental rights to the citizens of Eutopia. Further, to strengthen the nation’s economic
development, the government of Eutopia had in place its system of taxation which was a three tier
federal structure consisting of the central government, the state government and the local bodies.
With the changes in the tax structure across the globe, the state of Eutopia in order to remove the
cascading effect of the indirect taxes, sought to reform its existing indirect tax structure. After
several deliberations and discussions over the years, the Republic of Eutopia, on July 01, 2017
launched a new tax regime, having ended a variety of central and state imposed indirect taxes. The
legal framework of Eutopia is similar to that of union of Eutopia.
2. That the Central Government of Eutopia, introduced this new tax regime with much
grandiloquence, and claims to be a milestone in economic revolution. The newly developed tax
structure was a four set of enactments i.e. Central GST Act, 2017; Integrated GST Act, 2017;
Union Territory GST Act, 2017 and GST (Compensation to States) Act, 2017 (hereinafter
collectively referred to as “GST Act”). A single window tax was therefore imposed under the name
of Goods and Services Tax (“GST”). The introduction and injection of GST could be done only
through amending a number of provisions of the Constitution, as it purported to affect the existing
distribution of revenue between the Centre and the states and thereby impacting the federal set up.
The tax regime of GST being known to none, has been apprehended skeptically, for the real impact
on economy, common masses, business fraternity and state could not be precisely professed by
any economist.
3. That ever since the imposition of GST, a number of petitions including those in the form of
Public Interest Litigations (“PILs”) have been filed in various High Courts and the Supreme Court

of Eutopia. These PILs/ Writ Petitions, seek to challenge the validity of the GST Act and the
Constitution (One Hundred and First Amendment) Act, 2017, on a variety of grounds. Confused,
perplexed, baffled assessees have nowhere to go, to seek redressal of their grievance. The tax
practitioners, chartered accountants, company secretaries and government authorities are also
clueless about a lot of issues. Their last resort being judicial remedy, they have moved to the higher
courts for the redressal of their grievance. The Supreme Court, therefore, considering the gravity
of unrest and frustration empathized with people of Eutopia and has on its own motion, transferred
the cases pending in the high court’s on similar questions of law, to itself, using its power under
Article 139A of the Constitution. Interestingly, even some of the states have filed petitions under
the original jurisdiction of the Hon’ble Supreme Court under Article 131 of the Constitution,
complaining of ambiguity and violation of the federal setup.
4. That various associations of traders in respective items have challenged the constitutionality of
the GST Act on the ground of being abridgement of the Article 14 of the Constitution. They base
their contention on the fact that various items like petroleum, liquor etc. have been left out of the
purview of GST on arbitrary grounds. These traders also grieve that they still being under earlier
VAT and excise regime, have to pay different rates of taxes under different states. The exemption
to such commodities has been alleged to be arbitrary. Secondly, it is also alleged that such a
differential treatment is further agonized when the states charge VAT on such commodities as per
their own discretion having no uniformity at all and thereby being against the very object of GST
i.e. having a uniform price and uniform tax base for all the goods in all the states.
5. That some consumer associations have also filed PILs against the GST, claiming it to be against
consumer benefit and public interest. It is alleged that the selection of commodities and imposing
a particular rate of taxation on them has been done irrationally, unreasonably and arbitrarily. Some
have even gone to the extent of saying that such classification of tax base and goods under such
differential tax slabs has been done to favor certain industrialists close to the incumbent
government. Many items of basic necessities which are essential for bare survival have been
slapped with higher rate of taxation, whereas many useless/ luxurious goods have been offered a
lower tax rate. Therefore, some have alleged that GST to violative of not only Article 14 of the
Constitution but also Article 21 of the Constitution as being abridgment of life and liberty.

6. That one of the biggest reasons behind GST not being digested by the business class in Eutopia
is that it has been introduced without proper and due preparation. Along with introduction of GST,
the government has also claimed to scrap the paper based filing and the registration, payment,
filing and return being done only through electronic means and internet. It is alleged that a nation
where basic necessities and a square meal is hardly available cannot be expected to compulsorily
have computers and internet. Also, the GST regime has burdened an unending and unreasonable
task of filing work (37 filings in a year), which are vexatious, baffling and tiresome. Previously
under VAT regime, the trader had to do the filing only once in a year. In the current regime, a filing
is required every month. The burden of the traders gets heavier and worsened when despite trying
well in time, penalties is being imposed on them due to poor websites and server problems. The
traders have to pay penalties for no faults of their own. The tax practitioners instead of lending
them a helping hand have themselves cried foul. The filings and other formalities under GST and
the compliance required under it is alleged to require a resource to be allocated for it separately,
in addition to the respective business. GST has been framed in such a way that even medium sized
companies are struggling to keep up the rules, diverting resources that could have been devoted to
productive activity. Government has introduced unnecessarily complexity into what should have
been the simplest of laws.
7. That GST also aims and claims to bring the smaller traders into tax net, but not the way it should.
They are being forced in the system by the biggest customers in the supply chain; otherwise they
may lose business to those who are part of the system and whose payments the customer can claim
as refunds. However, such refunds are not made by the government in time and are delayed for
months. This raises their working capital needs, increasing cost and reducing competitiveness. So
as to avail the credit, even the smallest of traders want to buy from GST registered wholesalers.
However, the unorganized sector like farmers from villages etc. is not registered under GST
network and thus shall be a big looser in the system. Apparently their livelihood is fettered by the
system.
8. That moreover, in the previous regime, manufacturers were not required to comply with excise
rule, if the turnover is below 5 crore. With merging into GST, they have to register in case the
turnover crossed the limit of 20 lakhs under GST, again creating problem on small business
holders. The above mentioned problems in the respective paragraphs have been pleaded to

challenge the constitutionality of the GST Act and the Constitution (One Hundred and First
Amendment) Act, 2017, as being in violation of many fundamental rights and the constitutional
norms.
9. That the GST Act is also challenged on the grounds of vagueness and excessive delegation, in
derogation of the Constitutional norms. For instance, Section 171 of the Central GST Act (and the
corresponding provisions of the state GST Acts creates the obligation on businesses to pass on the
recipient any reduction in rate of tax or the benefit of input tax credit by way of commensurate
reduction in prices. The full guidance of what constitutes a commensurate reduction, what are the
parameters you would go by, mitigating factors, check and balance provisions among others ruled
to be in the Central GST Act itself. In the current form, the anti-profiteering rules give everything
a miss. The impugned section, in effect, casts a duty on a committee of bureaucrats who shall be
the anti- profiteering authority, who will in turn decide using their own discretion what
commensurate reduction is. This is alleged to be delegation too excessive on the bureaucrats. A
penalty also can be imposed by such discretion, which may even amount to cancellation of
registration, an imposition disproportionate with the GST Act and that too without checks and
balances.
10. That the GST Act and its implementation have also been challenged as being against good
governance and public trust. According to Reserve Bank of Eutopia, “the implementation of the
GST so far also appears to have had an adverse impact, rendering prospects for the manufacturing
sector in uncertain in the short term. This may further delay the revival of investment activity,
which is already hampered by stressed balance sheets of banks and corporate”.
11. That major fallout of GST is that the tax slab imposed is non-conducive to the ‘recycle-waste’
industry and therefore unfavorable to environmental concerns. The tax imposed on plastic waste
is 12%,while that on glass waste is 18%. This shall ultimately discourage people from buying
recycled goods. Another repercussion of such tax rate is that the rag pickers and the unorganized
labor sector shall be badly hit and lose their livelihood. A few NGOs have in this concern filed
PILs before the Supreme Court of Eutopia.
12. That a few states seem discontent with the idea of GST itself and base their argument that it
seeks to usurp the autonomy and independence of the states to a great extent and thereby causing

a imbalance in the federal structure. Having assumed federal structure of the Constitution as a
basic feature of the Constitution, they have challenged the Constitution (One Hundred and First
Amendment) Act, 2017 itself.
13. That the Chief Justice of Eutopia, in the light of seriousness of the issues involved and that the
issues also pertain to the interpretation of the Constitution has constituted a bench of 5 judges to
hear the matter in the case of “Association of Traders and Others versus Union of Eutopia.”

ISSUES RAISED
Issue I
Whether exemption of certain goods out of the purview of GST is grounded on some reasonable
classification or is arbitrary in nature and therefore unconstitutional?
Issue II
Whether GST Act paves way for excessive delegation of powers & is therefore unconstitutional?
Issue III
Whether Constitution (One Hundred and First Amendment) Act, 2017 is against the federal setup
of the Eutopia and is therefore unconstitutional?

SUMMARY OF ARGUMENTS
Issue 1
Whether exemption of certain goods out of the purview of GST is grounded on
some reasonable classification or is arbitrary in nature and therefore unconstitutional?
It is humbly submitted on the behalf of respondent that the exemption of certain goods and services
out of the preview of GST is founded on reasonable classification provided under Article 14 the
Constitution of Eutopia and this exemption has passed the test of reasonable classification also
provided under same Article 14 of the same constitution and there is not arbitrary and
unconstitutional
Issue 2
Whether GST Act paves way for excessive delegation of powers & is therefore
unconstitutional?
It is humbly submitted on behalf of the respondent that the power delegated under section 171 of
the central GST Act is a permissible delegation which means those powers which can be delegated
by parliament come into the preview of the Doctrine of permissible limits.
Delegated delegation is also known as bye laws and the power to make ‘bye-laws’ is conferred on
local authorities and statutory or other undertakings “for regulating the conduct of persons within
their areas or resorting to their undertaking”. If the rules and regulations are also made under the
enabling Act, the bye- laws are generally made subordinate to them.
Issue 3
Whether Constitution (One Hundred and First Amendment) Act, 2017 is against the
federal setup of the Eutopia and is therefore unconstitutional?
It is humbly submitted before the Hon’ble Court that the (one hundred and first amendment) Act,
2017 is not against the Federal set up of Eutopia. When we considered the debate on the federal

structure of the Eutopia then there was different views of different scholars and jurists and drafters
of the Euopian Constitution.
The federalism in Eutopia – Sir Ivor Jennings was of the view that Eutopia has a federation with a
strong centralizing policy.
In the other words, of D.D Basu the constitution of Eutopia is neither purely federal nor unitary,
but it is a combination of both. It is often defined to be quasi-federal in Nature.

PLEADINGS/ARGUMENTS ADVANCED
Issue 1
Whether exemption of certain goods out of the purview of GST is grounded on some
reasonable classification or is arbitrary in nature and therefore unconstitutional?
It is humbly submitted on the behalf of respondent that the exemption of certain goods and services
out of the preview of GST is founded on reasonable classification provided under Article 14 the
Constitution of Eutopia and this exemption has passed the test of reasonable classification also
provided under same Article 14 of the same constitution and there is not arbitrary and
unconstitutional.
Test of Reasonable Classification
While Article 13 forbids class legislation it does not forbid reasonable classification of persons,
objects, and transactions by the parliament for the purpose of achieving specific ends. But
classification must not be “arbitrary, artificial or evasive.” It must always rest upon some real and
substantial distinction bearing a just and reasonable relation to the object sought to be achieved by
the legislation. According to the Eutopian Supreme Court, classification to be reasonable must
fulfil the following two conditions:
Saurabh Chaudhari v Union Of Eutopia2
Firstly the classification must be founded on the intelligible differentia which distinguishes persons
or thing that are grouped together from others left out of the group.
Secondly the differentia must have a rational relation to the object sought to be achieved by the
act.
The differentia which is the basis of the classification and the object of the act are two distinct
things. What is necessary is that there must be nexus between the basis of classification and the
2
AIR 2004SC 2212

object of the act which makes the classification. It is only when there is no reasonable basis for a
classification that legislation making such classification may be declared discriminatory. Thus the
legislature may fix the age at which persons shall be deemed competent to contract between
themselves but no one will claim that competency. No contract can be made to depend upon the
stature or colour of the hair. Such a classification will be arbitrary.
The true meaning and scope of the right to equality [Article 14 in Eutopia] have been explained in
a number of cases by the Eutopian Supreme Court. The propositions laid down in Ram Krishna
Dalmia v. Tendolkar3 case still hold good governing a valid classification and are as follows.
1. A law may be constitutional even though it relates to a single individual if on account of

some special circumstances or reasons applicable to him and not applicable to others, that
single individual may be treated as a class by itself.
2. There is always presumption in favour of the constitutionality of a statute and the burden
is upon him who attacks it to show that there has been a clear transgression of constitutional
principles.
3. The presumption may be rebutted in certain cases by showing that on the fact of the statue,
there is no classification and no difference peculiar to any individual or class and not
applicable to any other individual or class, and yet the law hits only a particular individual
or class.
4. It must be assumed that Legislature correctly understands and appreciates the need of its
own people that their laws are directed to problem made manifest by experience and that
its discrimination are based on adequate grounds.
5. In order to sustain the presumption of constitutionality the court may take into
consideration maters of common knowledge, matters of report, the history of the times and
may assume every state of facts which can be conceived existing at the time of the
legislation.
6. Thus the legislation is free to recognize degrees of harm and may confine its restriction to
those cases where the need is deemed to be the clearest.
7. While good faith and knowledge of the existing conditions on the part of a legislature are
to be presumed, if there is nothing on the face of the law or the surrounding circumstances
3
1958 AIR, 538, 1959 SCR 279

brought to the notice of the court on which the classification may reasonably be regarded
as based, the presumption of constitutionality cannot be carried to the extent always that
there must be some undisclosed and unknown reason for subjecting certain individuals or
corporation to be hostile or discriminating legislation
8. The classification may be made on different bases e.g. geographical or according to object
or occupation or the like.
9. The classification made by the legislature need not be scientifically perfect or logically
complete. Mathematical nicety and perfect equality are not required.
Equality before the law does not require mathematical equality of all persons in all
circumstances. Equal treatment does not mean identical treatment. Similarly not identity
of treatment is enough.
10. There can be discrimination both in the substantive as well as the procedural law. Article
14 applies to both. If the classification satisfies the test laid down in the above propositions,
the law will be declared constitutional. The question whether a classification is reasonable
and proper and not must however, be judged more on commonsense than on legal subtitles.
As, it is apparent that Goods and Services Tax (GST) is the biggest and substantial indirect tax
reform since 1947. The main idea of GST is to replace existing taxes like value-added tax, excise
duty, service tax and sales tax. It will be levied on manufacture sale and consumption of goods and
services. GST is expected to address the cascading effect of the existing tax structure and result in
uniting the country economically.
Taxes subsumed under CGST
 Excise Duty
 Medical Excise
 CVD
 Service Tax
 CESSES
 SAD
 SURCHA RGES

Taxes subsumed under SGST
 VAT / Sales Tax

 Entry Tax / Contract / LBT
 Purchase Tax
 Luxury Tax
 Entertainment Tax
 State cesses & Surcharges
 Taxes on Lottery, batting and Gambling
Taxes not subsumed under GST
 Basic Custom Duties

 Excise on Liquor
 Property Tax
 Stamp Duty
 Tax on Sale / Consumption of Electricity
Products not covered under GST
 Petroleum Crude
 Motor Spirit (Petrol)
 High Speed Diesel
 Natural Gas
 Aviation Turbine Fuel
 Liquor
Main features of Goods & Services Tax Act-
1) Taxable event- Tax on supply of goods and services rather than manufacture / production of
goods provision of services or sale of goods.

2) Determination of Nature of Supply- Intra-state supply of goods and ser ices where the location
of the supplier and the place of supply are in the same state.
Inter-state supply of goods or services- where the location of the supplier and the place of
supply are in different state.
3) Liability to pay- Liability to pay tax arises only when the taxable person crosses the exemption
threshold.
4) Composition Scheme- Provision for levy of tax on fixed rate on aggregate turnover upto a
prescribed limitation in a final year.
5) Time and Value of supply- The time of supply of goods or services with following being
crucial determination with certain exemptions.
 Date on which supplier issues invoice.
 Date on which supplier review the payment.
 Tax is being period on termination value of supply.
6) Input Tax Credit- ITC is available in respect of taxes paid on any supply of goods or services
used or intended to be used in the course.
7) Registration- PAN based registration required to be obtained for each state from where taxable
supplies or being made.
8) Returns- normal tax-payers, compositions tax-payers, casual tax-payers, input service
distributors file separate electronic return with different cutoff dates.
Annual return to be filed by 31st December of the following final year along with a -------
statement.
9) Payment- System of electronic cash ledger and electronic ITC ledger.
Tax can be deposited by internet banking, NEFT / RTGS, Debit / Credit card, and over the
counter.
10) Refund- Time limit for refund of tax or interest is two years. Refund to be granted within 60
days from the date of receipt of complete application.
11) Assessment and Audit- Self- assessment of tax provisions for assessment of non-filers,
unregistered person and summary assessment in certain cases.
Provisions for provisional assessment on request of taxable person to be finalized in six months.

Audit to be conducted at the place of business of the taxable person or at the office of tax authorities
after prior intimation to taxable person.
Audit to be completed within 3 months.
12) Demand- Adjudication order to be issued within 3/5 years of filing of annual return.
13) Powers of officers and tax-payers right to appeal- Officers to have power of search and seizure
with inbuilt safeguards.
Restricted power to arrest and for prosecution.
Appeal to Supreme Court.
Objectives of Goods and Services Act-
 GST would help to eliminate the cascading effects of production and distribution cost of
goods and services.
 GST would eliminate the multiplicity of the indirect taxation and streamline of all indirect
taxes, which would be beneficial for manufacture and ultimate consumer.
 GST would be able to cover all the shortcoming of existing VAT system.
 Incidence of tax fails on dominates production.
 There should be no export of taxes cross taxing jurisdiction.
 Eutopian market should be integrates in to single common market.
 It enhances the cause of cooperative federalism.
Advantages of Goods and Service Tax Act-
Introduction of a GST is very much essential in the emerging environment of the Eutopian
economy.

 There is no doubt that in production and distribution of goods, services and increasingly used
or consumed. Separate taxes for goods and services, which is the present taxation system,
requires division of transaction values into value of goods and services for taxation, leading to
greater complications, administration, including complain costs. In the GST system, where all
the taxes are integrated, it would more possible the taxation burden to be split equitably
between manufacturing and services.
 GST will be levied only at the final distribution on consumption waste on VAT principle and
not at various points (from manufacturing to retail outlets). This will help in remaining
economic distributions and bring amount development of a common national market.
 It will also help to build a permanent and corruption free tax administration.
 Possible reduction in prices- due to full and seamless credit, manufacturers or traders do not
have to include taxes as a part of their cost of production, which is a very big reason to say that
we can see a reduction in prices.
 Increase in Government Revenue- This might seems to be little vague. However, even at the
time of introduction of VAT, the public revenues actually went up instead of falling because
many people resorted to paying taxes. However, the government may wish to introduce GST
at a revenue neutral rate, in which case the revenues might not see a significant increase in the
short run.
 Less complains and procedural cost- Instead of maintaining big records, returns and reporting
under various different statutes, all assesses will find comfortable under GST as the complains
cost will be reduced.
 Push to exports- With fall in production cost in domestic market, the competitiveness of
Eutopian goods in international market will increase. This bodes well for exporters, who
compete with global manufacturers.
 Information Technology enabling Services- The proposed GT rate under the I.T industry is not
yet divided. While the discussed combined rate of GST for the product in 27%. According to
proposed GST, if the software is transferred through electronic form, it would be regarded as
service (intellectual property), and if it is transferred through media or any other tangible
property, then it should be treated as goods.
 Infrastructure Sector- The Eutopian infrastructure sector largely comprises, power, road, port
and the indirect tax levy is different and unique for each of them and this complex in nature.

With the implication of GST, the multiplicity of the taxes will be removed and it would
increase the tax ways with continuation of exemption and concession for national interest.
 Impact on small Enterprises- In the small scale enterprises there are three categories:-
1) Those below threshold need not to register for the GST.
2) Those between threshold and composition turnover will have the option to pay turn based tax.
3) Those above threshold limit will need to be within framework of GST. Manufacturers, traders
will have to pay less tax with the implication of GST.
Issue 2
Whether GST Act paves way for excessive delegation of powers & is therefore
unconstitutional?
It is humbly submitted on behalf of the respondent that the power delegated under section 171 of
the central GST Act is a permissible delegation which means those powers which can be delegated
by parliament come into the preview of the Doctrine of permissible limits.

Delegated delegation is also known as bye laws and the power to make ‘bye-laws’ is conferred on
local authorities and statutory or other undertakings “for regulating the conduct of persons within
their areas or resorting to their undertaking”. If the rules and regulations are also made under the
enabling Act, the bye- laws are generally made subordinate to them.
Apart from the pure administrative function executive also performs legislative and the judicial
function also. The doctrine of permissible limits talks about those limitations of a legislation to
which the power can be delegated.
As well as the power delegated under section 171 of this Act necessary for fulfillment of object
which Is provided under Act, the clear principle mention and offered sufficient guidance so it
would not the excessive delegation.
HARISHAKAR BAGLA V/S STATE OF MADHYA PRADESH4
In this case the Supreme Court was satisfied that it laid a clear principle and offered sufficient
guidance, as the section provided that the power conferred therein was to be exercised “for
maintain or increasing supplies of any essential commodity or for securing their equitable
distribution and availability at fair prices.
So the power provided under the Act is necessary for fairness and without bye- laws the
administrative authority not able to work properly, it is also come into preview or permissible
limits so how can we say that it is excessive delegation. The power of appointment of examination
authority in hand of central government not in hand of bureaucracy.
The GST law contains a unique provision on anti-profiteering measure as a deterrent for trade and
industry to enjoy unjust enrichment in terms of profit arising out of implementation of goods and
services Tax in Eutopia, i.e., anti- profiteering measure would obligate the business to pass on the
cost benefit arising out of GST implementation to their customers.
The object of Anti-Profiteering measure section 171 provides that it is mandatory to pass on the
benefit due to reduction in rate of tax or from input tax credit to the consumer by way of
commensurate reduction in prices.
4
1954, AIR 465, 1955 SCR 313

The power has been given to central Govt. to constitute an authority to oversee whether the
commensurate benefit of allowance of input tax credit or reduction in the tax rates have been
passed on to the final customers.
IN KISHAN PRAKASH SHARMA V/S UNION OF EUTOPIA5
The Supreme Court laid down the test of constitutional limit of delegated legislation. The Supreme
Court in this case held that the legislature must set the limits of the power delegated by declaring
the policy of the law and by laying down standards for guidance of those on whom the power to
execute the law is conferred. Thus, the question is whether any particular legislation suffers from
excessive delegation and in ascertaining the same, the provisions of the statue including its
preamble, and the facts and circumstances in the background of which the statute is enacted. The
history of the legislation, the comheldplexity of the problems which a modern state has to face,
will have to be taken note of and if, on a liberal construction given to a statute, a legislative policy
and guidelines for its execution are brought out.
While the government can justify various anti-profiteering measures based on socialist principles,
the rules and methodologyneed to be clearly stated.
Nearly 70 years after B.R. Ambedkar and K.I. Shah debated over whether the Eutopian
Constitution should include the word ‘socialist’-the former was in favor of a society
beingorganised by thepeople of Eutopia, according to thetime and circumstances anti-profiteering
provisions present in the country’s plan to overhaul a broken tax system remind us of this very
debate.
The primary objective of the goods and services tax (GST) is to remove, the cascading effect of
existing taxes, which is tax on tax. The core principle of the GST is based on the fact that the tax
on any input or input service utilized during the process of developing a product or a service would
have to be offset against the subsequent output tax paid. The seamless credit system has been
formulated keeping the consumer in mind and removes inefficiencies in the supply chain however,
what if an entity in the supply chain for instance, a wholesaler, decides to take benefit or areduced
tax rate country the GST and not pass on such benefit to a consumer by hikingup his profit?
5
2001(3) TMI 1018 SC

To counter such undue benefit, the Government inserted section 171 into the central Goods and
services Tax Act. Section 171 of the CGST specifies that any benefit availed through extra input
tax credit or a reduction in rate of tax on any supply of goods or services has to be passed on to the
consumer commensurately.
In Eutopia INC’S primary objection to anti- profiteering lies around the fact that it adds an
additional compliance burden and that more importantly, a reduction in rate of taxes of input or
input services need not necessarily result in a proportionate reduction in the final price of a product
or service.
In GAREWAL V/S STATE OF Punjab6, Section 3 of the all Eutopia Services Act, 1951, which
gave power to the central Government to frame rules for the regulation or recruitment and the
condition of service was upheld. In this case, the court found the policy and guidance of the Act
in the then existing rules which were continued by the Act, although power was given to vary or
amend then by now rules framed under the Act. It was held that the procedure prescribed in the
Act for making of rules that they were to be laid on the table of parliament before they could come
into force and were open to modification on a motion made in parliament, was sufficient control
over the delegate and the Act did not suffer from excessive delegation.
IN BANARSIDAS V/S STATE OF MADHYA PRADESH7
It was said that although the power to tax is a well-recognized legislative power, ample latitude
has been allowed to the legislature to leave to a delegate the power to work out to details of a tax
policy. In upholding a power delegated to the state government for amending the schedule relating
to exemptions in a sales tax legislation justice Venkataramaaiyar observed:
“Now the authorities are clear that it is not unconstitutional for the legislature to leave it to the
executive to determine details relating to the working of taxation laws, such as the selection of
persons on whom the tax is to be laid, the rate at which it is to be charged in respect of different
classes of goods and the like.”
6
1956, SC 512
7
1958 SC, 909 , P.913

Issue 3
Whether Constitution (One Hundred and First Amendment) Act, 2017 is against the
federal setup of the Eutopia and is therefore unconstitutional?
It is humbly submitted before the Hon’ble Court that the (one hundred and first amendment) Act,
2017 is not against the Federal set up of Eutopia. When we considered the debate on the federal
structure of the Eutopia then there was different views of different scholars and jurists and drafters
of the Euopian Constitution.

The federalism in Eutopia – Sir Ivor Jennings was of the view that Eutopia has a federation with a
strong centralizing policy.
In the other words, of D.D Basu the constitution of Eutopia is neither purely federal nor unitary,
but it is a combination of both. It is often defined to be quasi-federal in Nature.
No doubt, Eutopia has a political and constitutional structure where federal features are evident
.There is sharing of power between the Centre and the States but the Constitution provides Central
Government with supreme powers and concentrates administrative and financial powers
completely in its hands. In Prakash Karat “Federalism and the political system in India)Seems
there was some deficiency which made the constitutional framers to incorporate features which
worked against the federal principle. Reiterating some Central Government’s powers, it has the
power to recognize the states through parliament; Governors appointed by the Centre can withhold
assent to legislation passed by the state; Parliament can override the legislations passed by the
state; Parliament can override the legislations passed by the states for the reasons of national
interest; Governors have a role in the formation of state government and the Centre is vested with
the Central authority. Fortunately, the reviewing power of judiciary of Centre-State relation exists
as that in federal features which are circumscribed with a built-in unitary core.(Prakash Karat
“Federalism and the political system in India).
West Bengal V. Union of India8, this case dealt with the issue of exercise of sovereign powers
by the Eutopian states. The Supreme Court in this case held that the Eutopian Constitution does
not promote a principle of absolute federalism. The court further outlined four characteristics
highlighting the fact that the Indian Constitution is not a “traditional federal Constitution.
The Eutopia Constitution is a constitution sui generis On one hand , the constitution contains
features which are of high importance for a federal arrangement , at the same time it contains
provisions which fight for a strong Centre, thus ,making it quasi-federal in nature. The fact to be
appreciated here is that these dual federalism provisions were deliberately incorporated to best fit
a polyglot country like Eutopia.
8
1963 AIR, 1241, 1964 SCR (1) 371

The Constitution One Hundred and First Amendment Act ,2017 brings the following notable
amendment in the Constitition of Eutopia-
 The residuary power of legislation of Parliament under article 248 is now subject to article
246A.
 Article 249 has been changed so that if 2/3rd majority resolution is passed by Rajya Sabha,
the Parliament will have powers to make necessary laws with respect to GST in national
interest.
 Article 250 has been amended so that parliament will have powers to make laws related to
GST during emergency period.
 Article 268 has been amended so that excise duty on medicinal and toilet preparation will
be omitted from the state list and will be subsumed in GST.
 Article 268 has been repealed so now service tax is subsumed in GST.
 Article 269 would empower the parliament to make GST related laws for inter-state
trade/commerce.
Compensation to States for Revenue Loss-
Further, the amendment also provided that Parliament shall, by law, on the recommendation by
Goods and Service Tax Council , provide compensation to the states for loss of revenue arising
on account of implementation of the Goods and Service tax for a period of five years.
The soon to be implemented Goods and Services Tax (GST) is expected to harmonize indirect
taxes & build a unified Indian tax structure. Currently there are myriad indirect taxes that are levied
and collected by the union and state Government since each state government has power to decide
its own indirect tax policy (rates, exemption , limits , etc.). A commodity , thus is priced differently
across states. This is seen to be incovientent for traders involved in Inter-state transactions and
business concerns based across multiple States. GSTshall harmonize all these indirect taxes and
replace them with a uniform GST rate. TheNation ‘s uniformity directly linked GST.
It has been argued over and over again that it will subsume State Value Added Tax, Entertainment
Tax, Central Sales tax, Octroi and Entry tax, Purchase tax, Luxury tax, Taxes on Lottery, betting

and gambling; and state cesses and surcharges in so far as they relate to supply of goods and
services . In this way , even local bodies will be affected by the GST and thus, it allegedly attack
on the federal structure of our country. So the by the 101st Constitution Amendment Act the Sixth
Schedule has been amended to give power to the District Councils to levy and collect taxes on
entertainment and amusements.(para8, sub-para3). From whose point of view it is attack the
federal set up of Eutopia but actually it will broaden the tax base, increase tax compliance, and
reduce economic distortions caused by inter-state variations in taxes. There is no doubt that the
practise of levying excise duties by the Centre, Sales taxes by the States and octroi by local bodies
has made the tax system absolutely non-Transparent.
Political Autonomy of the States
Even the political ego of the states remains at place with GST.Owing to our federal structure, GST
is dual ,levied and managed by different administration. Centre would levy &collect Central Goods
and service Tax (CGST) & state would levy & collect the State Goods and services Tax (SGST)
on all transaction of the states. And the rates of (CGST ) & (SGST) will be administered by the
GST Council which is neither an agent of state nor of Centre.
Not only this, but also the loss of revenue will be compensated to the states for next five years.
Alcoholic liquor for human consumption is exempt from GST and some certain petroleum product
are also exempt as given in the fact sheet of fact of the case till the Council decides on them and
number doubt can be passed to the fact that Liquor sale have always led to largest revenue
collection by states. Along with this, the capacity of states to generate revenue related to non -
goods & non -serious cannot be underestimated.
Cooperative Federalism
Another factor which may develop through One Hundred and First amendment Act 2017 brings
out Cooperative federalism though Indian states have achieved political integration in 1950’s with
the integration of Princely states in Indian Union , Economic Integration was still missing .Passing
of GST is a shining example of Cooperative federalism where states & centre have Ceded their
power to tax & come up with a single tax system to realize the dream of on Economic Eutopia
with ‘one market’ Thus GST once again has shown Unity in Diversity of Indian Society.

“Cooperative federalism also known as marble -cake federalism, is a concept of federalism in

which national, state &local government interact cooperatively &collectively to solve common
problems, rather than making policies separately but more or less equally or clashing over a policy
in a system dominated by the National Government.
King v/s Smith9 and a series of subsequent AFDC Cases .more recently, the phase has been used
in connection with other federal programs build on the Cooperative federalism. As India takes
great pride in describing itself as the world‘s largest democracy. However, this democracy is
meaningful significantly because it is encapsulated in a federal structure. While democracy
represent the majority opinion , federalism accommodates& links of social justice .This ensures
harmonious functioning of entire system.
Federalism & Cultural & Ethnic purism have given the country ‘s political system great flexibility,
and therefore the capacity to withstand stress though accommodation. However , continuation of
the same requires not simply federalism but Cooperative & Constructive federalism.
The State of Rajasthan v/s UOI 197710 it was quoted that the according to Granville Austin , the
Constitution of India was perhaps the first Constituent body to embrace from the start what A.H
Birch and others have called “Cooperative federalism “.cheif Justice Beg called the constitution
‘amphibian ‘ if our constitution creates a Central government which is ‘amphibian’ in the sense
that it can move either on the federal or on the unitary plane , according to the needs of the situation
and circumstances of a case “ State of Haryana v/s state of Punjab11, the word “Semi –federal
was use. Shamsher singh v/s state of Punjab12, the Constitution was called “more unitary than
federal”.
Under Article 279A -The GST Council will consist of the Union Finance Minister (as Chairman)
, the Union Minister of State in charge of Revenue or Finance or Taxation or any other Minister,
nominated by each state government thus, emphasising the fact that states’ say and opinions will
be catered to and federal essence of the country has been duly preserved.
9
392 U.S. 309 (1968)
10
1977, AIR 1361, 1978 SCR(1)
11
JT 2004(5) SC 72, 2004
12
AIR, 1974 SC 2192

All decision of the GST Council will be made by three fourths majority of the votes cast; the Centre
shall have one-third of the vote cast , and the states together shall have two-third of the votes cast.
The GST council with representation from both Centre as well as the states is not a body of Union
but an independent body in itself .Further, both, Parliament and state legislatures will have the
power to make laws on the taxation of Goods and Service Tax(Art.246A). A law made by
Parliament in relation to GST will not override a state law on GST. This again emphasises on the
need of not worrying about federalism being undermined.
Under Article 246A(2)- Though the central government will have the exclusive power to levy and
collect GST in the course of interstate trade or commerce , or imports known as Integrated
GST(IGST), but based on the recommendation of the GST Council which is a independent body
and a pop out the cooperative federalism .
Overlapping taxes can rob the tax system of simplicity and transparency ,alter relative prices in
unintended ways, make tax crediting on exports difficult , cause inter-state tax competition and tax
exportation to result in inequitable resources flows.
The main aim of fiscal federalism enshrined in Article 301 of the Constitution is the free and
unified movement of trade, commerce and intercourse throughout the territory of Eutopia. Article
268 and 269 provide for the levy and collection of certain taxes by the Centre, but the revenues
are to be entirely assigned to the States and that is what GST has aimed at. The Pith and Substance
of Fiscal federalism lies in cooperation, to coordinate with the policies of all levels of the
government.
GST a shining example of cooperative federalism In our federal system both state and centre have
power to impose taxes. The division of such taxation power is given in union and state list under
7th schedule. With the spirit of Cooperative federalism, under GST , both centre and state have
given up taxation powers .The constitution of Eutopia has also been amended accordingly the
fundamental reordering of federal fiscal relations for the cause of common good shows the strength
and resolve of the federal structure. The convergence for the cause of larger public good has been
made under the GST regime the centre and state will act on the recommendation of the GST
Council.

Harmonization of GST Laws across the country: Even though Centre and each state legislature
have passed their own GST dActs, they all based on the Model GST law drafted jointly by the
Centre& and the States.
Common Compliance Mechanism – GSTN, a non-for-profit, non-governmental company

promoted jointly by the central and state government, is the common compliance portal and the
tax players shall interface with all state as well as centre through this portal.
Joint Capacity Building Efforts –Joint capacity Building Efforts by Centre as well as all the states
are being organised wherein for the first time the training of officers of Centre and state being
conducted under auspices of National Academy of Customs, Indirect Taxes and Narcotics
(NACIN). NACIN has formed a joint coordination committee in each state comprising of Centr ,
State and NACIN officers for overseeing capacity Building efforts.
Joint Trade Awareness and Outreach Efforts: Centre along with the state Government Officials
has been organising Joint Trade Awareness & Outreach programs wherein first time the officers
came together to create GST awareness among Trade and other stakeholders. Cross empowerment
of officers of centre as well States: Though GST will be jointly administered by Centre and State
, for ensuring ease of doing business , but the individual taxpayer will have a single interface with
only one Tax Authority either Centre or State.
Joint Implementation Committees: In order to ensure smooth rollout of GST, the GST Council has
formed a three tier structure consisting of: the Office of Revenue Secretary , GST implementation
Committee(GIC) and eight standing Committees and other also all of them for ensuring effective
implementation of GST. Indeed GST in India in its conception , enactment and implementation is
an example of real Co-operative federalism at work, in tune with the unique character of Eutopia
–‘Unity in Diversity’.
Economic Integration-Under GST regime the entire country will become one market and it will be
an economic integration of Eutopia. Eutopia would become one uniform market with seamless
transfer of goods and services.
GST is a great example of Co-operative federalism and it must be hailed instead of of opposing
for it opens the path of development for the country. However Constitution still provides room for

states to levy tariff and non-tariff barriers. Article 302 gives Parliament the power to restrict free
trade between and within states on ground of public interest. Similarly 304(b) allows state
legislatures to restrict trade and commerce on ground of public interest The gist of these provision
is that both Centre and State have considerable freedom to restrict trade and commerce. So even
the distribution of power is also there some limitation also present and but nothing can’t exceed
the ambit of the Eutopian Constitution the One Hundred and first Amendment Act, 2017 emphasis
the Economic Integration and works only for the benefit for the consumers which is people of the
nation ultimately the amendment enshrined the nation economy and welfare for the people of the
nation which is first priority of any Government and it can done by both level of Government
through Cooperative and Constructive federalism. The new chapter of Cooperation has been added
within this diversity through cooperation between Centre and State which economically integrates
Eutopia and strengthen its unity so The Constitution( One Hundred and First Amendment ) Act ,
2017 is not against the federal setup of Eutopia and therefore constitutionally valid in nature.
PRAYER
In the light of facts stated arguments advanced and authorities cited, the respondent humbly
submits that the Hon’ble Court may be pleased to adjudge and dismissed the petition.
1) That the exemption of certain goods and services out of the purview of GST is grounded on
some reasonable classification or it is not arbitrary in nature and therefore declared to be
constitutional in nature & or it is constitutional valid.
2) That the GST act is under the ambit & scope of the delegation of power & it is constitutional
valid.
3) The constitution (one hundred and first amendment) Act, 2017 is not against the federal setup
of the Eutopia and is therefore the act will be a constitutionally valid.

Any other order as it deems fit in the interest of equity, justice and good
conscience.
For This Act of Kindness, the Petitioner Shall Duty Bound Forever Pray.
All of which is most humbly prayed.
Counsel for the Respondent

Ii Jlu National Moot Court Competition-2018: Memorial On The Behalf of Respondent

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II JLU NATIONAL MOOT COURT COMPETITION-2018

LIST OF ABBREVIATIONS …………………………………………….…..……………..2

(i) Cases Cited …………………………………………….………..………………..3

(ii) Books Referred ………………………………………….…….………………...3

(iii) Statutes Referred ………………………………………….…………………....4

(iv) Web links Referred ……………………………………………………………..4

STATEMENT OF JURISDICTION …………………………………………….………….5

STATEMET OF FACTS …………………………………………………………………...6-12

ISSUED RAISED …………………………………………………………………….…....13

SUMMARY OF ARGUMENTS ……………………………………………………….….14

PLEADINGS/ ARGUMENTS ARGUMENTS ……………………………………….…...15-19

MEMORIAL ON THE BEHALF OF RESPONDENT Page 1

AIR All India Reporter

I.P.C. Eutopian Penal Code

SCC Supreme Court Cases

SCR Supreme Court Report

SLP Special Leave Petition

u/a. Under Article

u/s. Under Section

FIR First Information Report

MEMORIAL ON THE BEHALF OF RESPONDENT Page 2

1. Saurabh Chaudhari v Union Of India, AIR 2004SC 2212

3. Prof. S. R. Bhansali, The Constitution of Eutopia,1st ed.2007, Eutopia Publishing House,

MEMORIAL ON THE BEHALF OF RESPONDENT Page 3

1. Constitution Of Eutopia, 1950

2. Central Goods & Services Act, 2017

3. State Goods & Services Act, 2017

4. Intra-State Goods & Services Act, 2017

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32. Remedies for enforcement of rights conferred by this Part

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Test of Reasonable Classification

Saurabh Chaudhari v Union Of Eutopia2

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1. A law may be constitutional even though it relates to a single individual if on account of

MEMORIAL ON THE BEHALF OF RESPONDENT Page 15

Taxes subsumed under CGST

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Taxes subsumed under SGST

 VAT / Sales Tax

Taxes not subsumed under GST

 Basic Custom Duties

Products not covered under GST

Main features of Goods & Services Tax Act-

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Audit to be completed within 3 months.

Restricted power to arrest and for prosecution.

Appeal to Supreme Court.

Objectives of Goods and Services Act-

Advantages of Goods and Service Tax Act-

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