TEAM CODE: SLCU 052

BEFORE THE HON’BLE SUPREME COURT OF INDIA

IN THE MATTER OF:

In Re: Special Reference regarding the 66th Constitutional Amendment Act, 2017.

Special Reference No. 1 of 2017

MEMORANDUM ON THE BEHALF OF THE APPELLANTS

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 TABLE OF CONTENTS

S R. NO. CONTENTS PAGE NO.

1. COVER PAGE (i)

2. TABLE OF CONTENTS (ii)

3. TABLE OF ABBREVIATIONS (iii)

4. INDEX OF AUTHORITIES (iv)-(v)

5. STATEMENT OF JURISDICTION (vi)

6. SYNOPSIS OF FACTS (vii)-(viii)

7. ISSUES RAISED (ix)

8. SUMMARY OF ARGUMENTS (x)

9. BODY OF ARGUMENTS 1-19

10. PRAYER 20

TABLE OF ABBREVIATIONS

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& And
Ahmd. Ahmedabad
AIR All India Reporter
ALL Allahabad
Anr. Another
Art. Article
CGST Central Goods And Services Tax
CriL.J. Criminal Law Journal
Edn. Edition
Govt. Government
GST Goods and Services Tax
Hon’ble Honorable
IGST Integrated Goods And Services Tax
IT Income Tax
ITD Income Tax Department
Itr Income Tax Return
Ori. Orissa
Ors. Others
Pg no. Page no.
Re. Reference
SC Supreme Court
SCC Supreme Court Cases
Sec Section
SGST State Goods And Services Tax
TN The North
U/A Under Article
UOI Union of India
UTGST Union Territory Goods and Services Tax
v. Versus
Vat Value Added Tax

INDEX OF AUTHORITIES

CASES REFERRED:
SNO. NAME OF THE CASE CITATION
1. Avinder Singh v. State of Punjab, (1979) 1 SCC 137.
2. Ganga Ram Moolchandani v. State of Rajasthan (2001) 6 SCC 89
3. Indra Nehru Gandhi v. raj Narain 0321 SC 1977
4. ITC LTD v Agricultural Produce Market (2002) 9 SCC 232
5. K.C. Gajapati Narayana Deo& Others v. The State Of AIR 1953 ORI 185
Orissa
6. KesavanandaBharati v. State of Kerala (1973) 4 SCC 225
7. M. Nagraj v. Union of India AIR 2007 SC 71
8. Minerva Mills Ltd. V Union of India 1981 SCR (1) 206
9. Mt. AtiqaBegam and Anr.v. Abdul Maghni Khan and AIR 1940ALL 272

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 Ors.
10. Nageshwar v. A.P.S.R.T. Corporation AIR 1959 SC 316
11. PunitabenKarsanbhai Patel Oral v. Income-Tax Officer 2006 103 ITD 175
Ahd.
12. Reference Case No. 1 of 1964 Special reference no. 1 of
1964
13. S.R. Bommai v. Union of India AIR 1994 SC 191
14. Sajjan Singh v State of Rajasthan 1965 SCR (1) 933
15. Sri Krishna Das v. Town Area Committee AIR (1991) SC 2096
16. State of Bihar v. Kameshwar Singh AIR 1952 SC 252
17. State of Haryana v. State of Punjab AIR (2002) SC 685
18. Syndicate Bottles Pvt. Ltd v. State Of Tamil Nadu
19. The State of Bombay and Another v. F.N. Balsara AIR 1951 SC 318
20. West Bengal v. Kesoram Industries Ltd. and Ors.. [2004]266itr721(sc)
21. Zameer Ahmed LatifurRehman Sheikh v. State of AIR 2010 SC 2633
Maharashtra and Ors.

BOOKS / STATUTES REFERRED:

A. STATUTES

1. Income Tax Act, 1961.

2. The Constitution of India, 1950.

3. Central Goods and Services Tax Act, 2017.

4. State Goods and Services Tax Act, 2017.

B. BOOKS AND DICTIONARIES

1. Ravi Puliani& Mahesh Puliani, Goods and Services Tax Manual(2 nd ed. 2017, Bharat
Law House Delhi)
2. V.SDatey, GST Ready Reckoner (4th ed. 2017, Taxmann’s)

3. Dr. Vinod K. Singhania& Dr. Monica Singhania, Students Guide to Income Tax ( 57 th

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 ed. 2017-18, Taxmann’s)
4. M.P. Jain , The Indian Constitutional Law ( 6th ed. Reprint 2011, Lexis Nexis)

5. Bryan. A Garner, Black’s Law Dictionary (8th ed. 2015, Thomson Reuters)

C. WEBSITE REFERRED

1. http://www.cbec.gov.in

STATEMENT OF JURISDICTION

The President of Westeros has sought for a Presidential Reference under Article 143 1 of the
Constitution of Westeros. The Petitioner humbly submits to the jurisdiction of this Court.

1
Power of President to consult Supreme Court:
(1) If at any time it appears to the President that a question of law or fact has arisen, or is likely to arise, which is
of such a nature and of such public importance that it is expedient to obtain the opinion of the Supreme Court
upon it, he may refer the question to that Court for consideration and the Court may, after such hearing as it
thinks fit, report to the President its opinion thereon.
(2) The President may, notwithstanding anything in the proviso to Article 131, refer a dispute of the kind
mentioned in the said proviso to the Supreme Court for opinion and the Supreme Court shall, after such hearing
as it thinks fit, report to the President its opinion thereon.

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 SYNOPSIS OF FACTS

1. One of the several colonies which gained independence in the year 1947 from the
British Empire was The Republic of Westeros. The Constitution of Westeros was
finally completed in the year 1950.
2. Thereafter, Dr. Hank Pym, who was considered as the father of Constitution of
Westeros, addressed the assembly and explained the true character of the Constitution
of Westeros in reference to federalism which was followed by further discussions in
which Dr. Reed Richards, member of the Constituent Assembly, quoted German
school of Political philosophy according to which one of the most important criteria to
interpret the concept of Federalism is “the activity of state must not be completely
circumscribed by orders handed down for execution by the superior unit”. The
important words were ‘must not be completely circumscribed’, which
envisagethatsome powers of the State are bound to be circumscribed by the exercise
of federal authority.
3. Also, in the discussion it was said that the Constitution of Westeros is a federal
Constitution only to the extent the states were granted powers under schedule VII of
the Constitution. Since it has always been the objective that the Centre be allowed to

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 harmonise the nation as one socio-economic unit and not to provide the states with
such sweeping powers that they administrate themselves as ‘one isolated unit’ and
therefore, the Constitution was made with a strong Centre to prevent the states from
becoming protectionist in nature.
4. Due to the presence of multiple statutes and separate administrative set ups lacking
uniformity, the current indirect tax regime of the Westeros is highly convoluted and
extremely cumbersome for people to conduct their business in Westeros which has led
to increase in the cost of compliance. For the purpose of combating the multiplicity of
problems created by the prevailing indirect tax regime, the Prime Minister of The
Westeros, Mr. Vader along with the finance Minister, Mr. Skywalker, decided to
introduce the Goods and Services Tax to effectively consolidate all the current
indirect taxes being paid and to update the current administrative setup.
5. The Parliament introduced the Goods and Services Tax by passing the 66 th
Constitutional Amendment act which casts away any doubt which the States have in
relation to impinging on their autonomy to levy/collect tax.
6. An Imperial Council was set up under the scheme of the Constitutional Amendment
which shall assist the States in resolving any grievances they have regarding the rate
of tax, etc. and its function is merely recommendatory in nature.
7. On 18th of February, 2017 the Imperial Council finalized the Central GST (CGST),
the Integrated GST (IGST) and the Union Territory GST (UTGST) Act, which was
finally approved and passed with a roaring majority on 1st of April, 2017. The
President of Westeros gave his assent to the aforesaid Acts on 15 th April, 2017 and
simultaneously drafts were being prepared by several states of their State GST
(SGST) Acts.
8. It was further stated that all the laws of India (except SGST Acts and Rules) and
Westeros being parimateria, the 66th Constitutional Amendment Act is same as the
101st Constitutional Amendment Act of India.
9. A state in Westeros named The North recently released its SGST Act and has defined
“supply” under section 7 of the said Act. It states “supply means any income earned
on Goods or Services or both shall be deemed to be supply”.
10. An objection was raised by Mr. Tony Stark and Mr.Bruce Wayne, two influential
industrialists in Westeros, to the legislative action of the State of The North which has
effectively imposed an income tax in the garb of GST under its SGST Act and several

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 representations have been made to the Prime Minister’s office by these industrialists
as they considered to promote double taxation.
11. They had approached the Hon’ble High Court of the North challenging the vires of
the TN-SGST, as it violated the fundamental principle laid down by the Hon’ble
Supreme court of Westeros, stating that what could not be done directly cannot be
done indirectly. The Hon’ble High Court while upholding the validity of TN SGST
Act opined that in the absence of any constitutional definition of the term “supply”,
the meaning ascribed to it would depend on the definition provided under the SGST.
12. President Francis Underwood took a note of the aforesaid litigation and sought for a
presidential reference under Article 143 seeing as how other states might also take
advantage of Art. 246 A to further their own interests.
13. The Registrar of the Hon’ble Supreme Court, after consulting the Attorney-General,
Gold D Roger, impleaded Mr. Stark and Mr. Wayne as parties to be heard in the
presidential reference.

ISSUES RAISED

1. WHETHER THE SCOPE OF ‘SUPPLY’ UNDER ARTICLE 246A IS

RESTRICTED BY THE DEFINITIONS PROVIDED IN THE TN-SGST AND
OTHER STATE GST LEGISLATIONS?

2. WHETHER THE CURRENT FISCAL REGIME UNDER THE

CONSTITUTION OF WESTEROS PERMIT DOUBLE TAXATION BY THE
VARIOUS GST LEGISLATIONS AND THUS VIOLATIVE OF ARTICLE 19(1)
(G)?

3. WHETHER THE 66TH CONSTITUTIONAL AMENDMENT

VIOLATIVE OF THE PRINCIPLE OF FEDERALISM EMBODIED UNDER
THE DOCTRINE OF BASIC STRUCTURE?

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 SUMMARY OF ARGUMENTS

1. WHETHER THE SCOPE OF ‘SUPPLY’ UNDER ARTICLE 246A IS RESTRICTED

BY THE DEFINITIONS PROVIDED IN THE TN-SGST AND OTHER STATE GST
LEGISLATIONS?

It is humbly submitted before this Hon’ble Court that the definition of ‘supply’ provided
under the TN-SGST Act clearly restricts the scope of ‘supply’ under Article 246 A of the
Constitution of Westeros. The State legislation has defined supply in terms of income which
is very vague and narrow as compared to the definition provided under the CGST Act, 2017
to which Article 246 A is subjected.

2. WHETHER THE CURRENT FISCAL REGIME UNDER THE CONSTITUTION OF

WESTEROS PERMIT DOUBLE TAXATION BY THE VARIOUS GST
LEGISLATIONS AND THUS VIOLATIVE OF ARTICLE 19(1) (G)?

It is humbly submitted to the Hon’ble court that the current fiscal regime of the republic of
Westeros permits double taxation as both State and Centre are simultaneously making laws

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 on income. It is also submitted that it will lead to hindrance in carrying trade and commerce
smoothly and thus violates the fundamental right of the citizens i.e. Art. 19(1)(g).

3. WHETHER THE 66TH CONSTITUTIONAL AMENDMENT VIOLATES OF THE

PRINCIPLE OF FEDERALISM EMBODIED UNDER THE DOCTRINE OF BASIC
STRUCTURE?

It is humbly submitted before the Hon’ble Court that the 66th Constitutional Amendment
clearly violates the principle of federalism and thus the doctrine of Basic Structure.
Federalism marks the clear demarcation of power with no overlapping between Centre and
States but introduction of GST has lead to chaotic situation in reference to the current fiscal
regime as Centre and State both have been empowered to form laws on the aforementioned
matter.

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 BODY OF ARGUMENTS
1. WHETHER THE SCOPE OF ‘SUPPLY’ UNDER ARTICLE 246A IS RESTRICTED
BY THE DEFINITIONS PROVIDED IN THE TN-SGST AND OTHER STATE GST
LEGISLATIONS?
1.1. It is humbly submitted to the Hon’ble Court that the scope of Supply under Article 246A2 is
restricted by the definitions provided in the TN-SGST Act, 2017 and other State GST
legislations. Section 7 of TN-SGST Act, defines “supply” as ‘any income earned on Goods or
Services or both shall be deemed to be supply’. This definition is highly vague and narrow,
and restricts the entire scope of supply under Article 246Awhich is extensive.
1.2. Further, GST under Article 366(12A)of the Constitution of Westeros is defined as ‘goods and
services tax as any tax on supply of goods, or services, or both except taxes on supply of the
alcoholic liquor for human consumption.’
1.3. Furthermore, Section 73 of CGST Act, 2017contains meaning and scope of ‘supply’. It is a
term of paramount importance under the GST regime and is pivotal point to determine levy
and collection of GST. Despite being a critical point, the Act has chosen to define “supply” in
an inclusive manner but has failed to define the term itself.
1.4. It is pertinent to note that the word used is “Supply” and not “Sale”. Thus, any supply
including stock transfer and branch transfer will also attract GST.
1.5. Moreover, as per Section 74 of CGST Act, 2017the expression “supply” includes all forms of
supply of goods or services or both such as sale, transfer, barter, exchange, license, rental,

2
Articles 246A (1) Notwithstanding anything contained in articles 246 and 254, Parliament, and, subject to
clause (2), the Legislature of every State, have power to make laws with respect to goods and services tax
imposed by the Union or by such State.
(2) Parliament has exclusive power to make laws with respect to goods and services tax where the supply of
goods, or of services, or both takes place in the course of inter-State trade or commerce.
Explanation.—The provisions of this article, shall, in respect of goods and services tax referred to in clause (5)
of article 279A, take effect from the date recommended by the Goods and Services Tax Council.]
3
Infra 4.
4
(1) For the purposes of this Act, the expression “supply” includes–– (a) all forms of supply of goods or
services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be
made for a consideration by a person in the course or furtherance of business;
(b) Import of services for a consideration whether or not in the course or furtherance of business;
(c) the activities specified in Schedule I, made or agreed to be made without a consideration; and
(d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II.
(2) Notwithstanding anything contained in sub-section (1),––
(a) Activities or transactions specified in Schedule III; or
(b) such activities or transactions undertaken by the Central Government, a State Government or any local
authority in which they are engaged as public authorities, as may be notified by the Government on the
recommendations of the Council, shall be treated neither as a supply of goods nor a supply of services.
(3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the recommendations of the
Council, specify, by notification, the transactions that are to be treated as—
(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.

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 lease or disposal made or agreed to be made for a consideration by a person in the course or
furtherance of business, besides the import of services for a consideration whether or not in
the course or furtherance of business. It also includes the activities specified in Schedule I,
made or agreed to be made without a consideration; and the activities to be treated as supply
of goods or supply of services as referred to in Schedule II.
1.6. It is further submitted that ‘income’ which is the sole taxable criterion as per the TN-SGST
Act implies that the transaction is being made for consideration while the definition provided
by the Centre which forms the subject matter for the purpose of Article 246A 5 as mentioned
above includes certain activities for which transaction can be made even without
consideration. Thus, ‘supply’ defined under TN-SGST Act undoubtedly restricts the scope of
supply under Article 246A.
1.7. Moreover, sub clause (3) of section 76 of CGST Act reads as subject to the provisions of sub-
sections (1) and (2), the Government may, on the recommendations of the Council, specify, by
notification, the transactions that are to be treated as—

(a) a supply of goods and not as a supply of services; or

(b) a supply of services and not as a supply of goods.

1.8. It is to bring to kind notice of this Hon’ble Court that the Government has been empowered
with great discretion under this clause which means, as per the prevailing circumstances, it can
issue any notification in order to include any transaction in the ambit of supply of goods or of
services. The definition provided under TN-SGST Act is confined only to income earned on
goods and services which implies that power of the government, as provided under sub section
(3) of section 77 of CGST Act, has been clearly restricted by the State of North while passing
the legislation.
1.9. With reference to the aforementioned definition of ‘supply’, it is further contended that
‘supply’ as defined under TN-SGST Act has been restricted in terms of ‘income’ while the
definition provided by the CGST Act, which is to be read in consonance with Article 246A 8of
the constitution of Westeros in order to examine the true nature of the scope of supply,
includes all forms of supply of goods or services for a consideration, in the course of or for
furtherance of business or even without a consideration.

5
Supra note 2.
6
Supra note 4.
7
Supra note 5.
8
Supra note 2.

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1.10. Furthermore, the State of North has defined supply in a very vague manner since the term
‘income’ is the only criterion which has to be taken into consideration while imposing tax on
goods and services. The scope of supply under Article 246A9 is very wide. Its wideness can be
confirmed if read with definition of ‘supply’ under Sec.7 10 of the CGST Act, 2017. Income
tax, already being imposed by the Centre, is the subject for which only Central Government is
empowered to make laws under Entry 8211 of the Union List. Goods and Services Tax intend
to integrate all the indirect taxes like sales tax, service tax, VAT, excise duty, etc. This
signifies that ambit of its jurisdiction is far-reaching. The State of North has tried to confine
the scope of supply in terms of ‘income’ by defining it under its GST Legislation. By doing
so, it has also tried to forcefully impose income tax under the guise of GST. The Government
of State of North is trying to exploit the general public and with the sole purpose of increasing
revenue collection exponentially, it has passed the TN-SGST Act, 2017.
1.11. Moreover, the definition of supply under CGST Act, 2017 expressly includes sale, transfer,
barter, exchange, license, rental, lease or disposal made or agreed to be made for a
consideration by a person in the course or furtherance of business. Income, as defined under
section 2 (24)12 of Income Tax Act, 1961, includes sum, allowances and values which are
capable of being calculated in terms of money, while the definition of ‘supply’ under CGST
which forms the subject matter of taxation under Article 246 A 13, is inclusive and has
expressly included barter, exchange, license, etc. terms which are comparatively broader in
scope.
1.12. Further, this is to bring to the kind notice of this Hon’ble Court that barter, as defined in
Black’s Law Dictionary, means the exchange of one commodity for another without the use of
money.14
1.13. Hence, it is basically the trading of goods or services directly for other goods or services,
without using money or any other similar unit of account or medium of exchange. It is not
possible to estimate the exact value of goods and services under barter system. Therefore,
9
Supra note 2.
10
Supra note 5.
11
Taxes on income other than Agricultural income.
12
Section 2(24) " income" includes-
(i) profits and gains;
(ii) dividend;
(iia)  voluntary contributions received by a trust created wholly or partly for charitable or religious purposes or
by an institution established wholly or partly for such purposes 8 or by an association or institution referred to in
clause (21) or clause (23), or by a fund or trust or institution referred to in sub-clause (iv) or sub- clause (v) of
clause (23C) of section 10]. Explanation.- For the purposes of this sub- clause," trust" includes any other legal
obligation;]
13
Supra note 2.
14
Bryan A. Garner , Black’s Law Dictionary 160 (8th ed. 2015, Thomson Reuters).

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 money does not essentially forms the subject matter of consideration under the definition
provided under CGST Act, 2017 while it is the main element of the definition given by the
State of North. Thus, the definition of ‘supply’ given under section 715 of TN-SGST Act
clearly restricts the scope of supply under the amended Article 246A 16 of the Constitution of
Westeros.
1.14. Further, the State of North which has defined‘supply’ in terms of income subsequently
imposes tax on such supply. It is implied that it is apparently trying to impose income tax in
the garb of GST as scope of supply is comparatively wider as per the CGST Act which forms
the subject matter of the amended Article 246A 17 of the Constitution of Westeros. Hence, it is
clear from the above observation that the State of North has been trying to make law on a
subject which is already being governed by the Centre since the Constitution of Westeros
came into force. The doctrine of pith and substance herein comes into play. The basic purpose
of this doctrine is to determine under which head of power or field i.e. under which list (given
in the Seventh Schedule) a given piece of legislation falls.
1.15. Furthermore, the doctrine of Pith and Substance has been explained in the case of Zameer
Ahmed Latifur Rehman Sheikh v. State of Maharashtra and Ors. 18:“This doctrine is
applied when the legislative competence of the legislature with regard to a particular
enactment is challenged with reference to the entries in various lists. If there is a challenge to
the legislative competence, the courts will try to ascertain the pith and substance of such
enactment on a scrutiny of the Act in question. In this process, it is necessary for the courts to
go into and examine the true character of the enactment, its object, its scope and effect to find
out whether the enactment in question is genuinely referable to a field of the legislation
allotted to the respective legislature under the constitutional scheme.”
1.16. Pith means ‘true nature’ or ‘essence of something’ and Substance means ‘the most important
or essential part of something’. Doctrine of Pith and Substance says that to ascertain the true
character of the legislation in question, regard must have to it as a whole, to its objects and to
the scope and effect of its provisions. If according to its ‘true nature and character’, the
legislation substantially relates to a topic assigned to the legislature which has enacted it, then
it is not invalid ‘merely because it incidentally’ trenches or encroaches on matters assigned to
another legislature.19

15
‘any income earned on Goods or Services or both shall be deemed to be supply’.
16
Supra note 2.
17
Supra note 2.
18
AIR (2010) SC 2633.
19
M.P Jain, Indian Constitutional Law,591 (6THed. 2011 ).

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1.17. Moreover, in the landmark case of The State of Bombay and Another v. F.N. Balsara, 20the
Hon’ble Supreme Court upheld the Doctrine of Pith and Substance It observed that it is
important to ascertain the true nature and character of legislation for the purpose of
determining the List under which it falls. In the matter at hand, income tax is being dealt with
by the State of North which is actually the subject matter of Union List. Moreover, the history
of taxation reveals that states have never been empowered to impose a tax on income.
1.18. Similarly, in the case of Mt. AtiqaBegam and Anr. v. Abdul Maghni Khan and Ors. 21 –
The Court took recourse to the doctrine of pith and substance and stated “it is the result of this
investigation, not the form alone which the statute may have assumed under the hand of the
draughtsman, that will determine within which of the Legislative Lists the legislation falls and
for this purpose the legislation must be scrutinized in its entirety”.
1.19. In the instant case, while applying the doctrine of pith and substance, it can be drawn that
income is the subject matter on which Central Government has exclusive power to impose tax
and the objective of TN-SGST Act, 2017is imposition of tax on supply which is equivalent to
imposition of tax on income as can be drawn from the definition of ‘supply’ which implies
that the State of North has been trying to do indirectly what cannot be done directly.
1.20. Further, it is pertinent to note that supply is a very wide term and it shall be interpreted so as
to include wide range of things so as to simplify the procedure under the current fiscal regime.
As far as ‘supply’ is concerned, there has been provided a concept of deemed supply in order
to avoid any conflicts and it is as follows-

20
 AIR (1951) SC 318.
21
AIR (1940) All 272.

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1.21. Furthermore, Schedule 222 of CGST Act, 2017, read with S. 7(1)(d), provides clarity on
determining the type of supply as supply of goods or of services. This aims at eliminating the
ambiguity that exists in the current indirect tax system. Transactions deemed as supply of
goods under the above section include transfer of the title in goods, transfer of title of goods
under an agreement, Permanent transfer or disposal of business assets with or without
consideration, lease, tenancy, easement, license to occupy land, any business assets put for
private use whether or not for consideration, etc. Thus the scope of supply under Article 246 A
is comparatively wider.
1.22. Hence, the definition of supply given under the TN-SGST Act undoubtedly restricts the scope
of supply under the amended Article 246 A23 as it confines the supply to include income
earned on goods and services. Income is again an important aspect for the purpose of taxation
laws and is to be read in accordance with the very objective of passing various GST
legislations.

22
Any transfer of the title in goods is a supply of goods:
• Any transfer of title of goods under an agreement which stipulates that property in goods will pass at a future
date upon payment of full consideration as agreed like hire purchase ;
• Permanent transfer or disposal of business assets with or without consideration ;
• Supply of goods by any unincorporated association or body of persons to a member thereof.
Transactions Deemed as Supply of Services:
• Transfer of right or undivided share in goods without transfer of title
• Any lease, tenancy, easement, license to occupy land
• Any lease or letting out of the building for business or commerce either wholly or partially
• Any treatment or process applied on another person’s goods like job work
• Any business assets put for private use whether or not for consideration
• Renting of immovable property
• Construction of a complex, building, civil structure or part thereof
• Temporary transfer or permitting the use or enjoyment of any intellectual property right
• Development, design, programming, customization, adaptation, up -gradation, enhancement, implementation
of information technology software ;
• Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act
Works contracts;
Supply of goods, being food or any other article for human consumption or any drink.
23
Supra note 2.

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 2. WHETHER THE CURRENT FISCAL REGIME UNDER THE CONSTITUTION OF
WESTEROS PERMIT DOUBLE TAXATION BY THE VARIOUS GST
LEGISLATIONS AND THUS VIOLATIVE OF ARTICLE 19(1) (G)?

2.1. It is most humbly submitted that the current fiscal regime under the Constitution of Westeros
clearly permits double taxation by the various GST legislations that have been introduced by
the recent 66th Constitutional amendment which is the amended Article 246A24 and thus,
violates Article 19 (1) (g)25 of the Constitution of Westeros. It is humbly submitted before
this Hon’ble Court that Article 366(12A)26of the Constitution of Westeros defines “goods
and services tax as any tax on supply of goods, services, or both except taxes on the supply of
the alcoholic liquor for human consumption”.

2.2. Further, GST as implemented in the current fiscal regime is neither sales tax nor service tax
rather it is a tax on supply of goods and services. The Goods and Service Tax, or GST, has
rolled out in Westeros with the strong purpose of levying a single indirect tax across the
nation aiming at unifying Westeros as a single unified market and in order to ensure that
States do not act as isolated units but as an integrated part of the unified country. This tax is a

24
Supra note 2.
25
Article 19(1) (g) to practise any profession, or to carry on any occupation, trade or business.
26
The term 'GST' is defined in Article 366 (12A) to mean "any tax on supply of goods or  services or both except
taxes on supply of the alcoholic liquor for human consumption’.

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 multi-stage and destination-based tax that will be levied on every value addition (the addition
of monetary value) and thus, it is a “One Nation-One Tax” concept. It shall be noted that
throughout the world except for Brazil and Canada, most of the countries have a unitary GST
taxation system. The current fiscal regime of Westeros provides for enactment of SGST’s
(State Goods and Services Tax) along with CGST (Central Goods and Services Tax), which
implies that it will lead to several GST Acts introduced by the various States of the Republic
of Westeros, which is in complete contradiction to the idea of what we call “One Nation One
Tax”. The petitioner contends that such requirement of SGST defeats the very purpose of an
integrated tax regime as contemplated under the new GST regime i.e. to do away with the
cascading effect of the erstwhile tax system.

2.3. Furthermore, Art. 19 (1) (g)27 provides for Freedom of Trade & occupation. The Constitution
of Westeros guarantees each of its citizens to practice trade, occupation or business anywhere
in the country. Sub clause (g) of Article 19 (1) confers a general and vast right available to all
persons to do any particular type of business of their choice. Though State, under Article 19
(6)28 is empowered to impose reasonable restrictions on the right guaranteed by Article 19 (1)
(g), yet these restrictions should be for public welfare and in the interest of society.

2.4. It is pertinent to note that Double taxation occurs when an individual is required to pay two or
more taxes for the same income, asset, or financial transactions. It usually refers to
income taxes paid twice on the same source of earned income. The term ‘double taxation’ has
been defined by the Hon’ble Supreme Court in Sri Krishna Das v. Town Area
Committee,29 that it implies taxing the same property or subject matter twice, for the same
purpose, for the same period and in the same territory. To constitute double taxation two or
more taxes must have been (1) levied on the same property or subject matter, (2) by the same
Government or authority, (3) during the same taxing period, and (4) for the same purpose. In
the matter at hand the subject matter that is ‘goods and services’ within the territory of the
State are being taxed by Central Govt. as well as by the State Govt.
27
Supra note 18.
28
Article 19(6) Nothing in sub clause (g) of the said clause shall affect the operation of any existing law in so
far as it imposes, or prevent the State from making any law imposing, in the interests of the general public,
reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular, nothing in
the said sub clause shall affect the operation of any existing law in so far as it relates to, or prevent the State
from making any law relating to,
(i) the professional or technical qualifications necessary for practicing any profession or carrying on any
occupation, trade or business, or
(ii) the carrying on by the State, or by a corporation owned or controlled by the State, of any trade, business,
industry or service, whether to the exclusion, complete or partial, of citizens or otherwise.
29
AIR (1991) SC 2096.

Page | 8
2.5. In another case of Punitaben Karsanbhai Patel Oral v. Income-Tax Officer, 30 the Court
adjudged that one of the basic principles of taxation is that ‘the income shall not be taxed
twice.’

2.6. Moreover, it is to be noted that the power of taxation has been divided between the Centre
and the State clearly mentioned in the Constitution of Westeros and the principle which can
be conferred from various judgments as mentioned below given by the Hon’ble Courts is that
there can be no overlapping of taxes by the Centre or the States. Article 24631 of the
Constitution of Westeros clearly demarcates power of taxation on various commodities as
mentioned in the lists provided in Schedule VII. In entries 82, 85, 86, 89, 90, 92, etc of list I
and entries 46, 49, 50, 51, 52, 53 etc of list II contain power to levy tax on various
commodities. It shall further be noticed that there is no entry regarding the levying of taxes in
list III, i.e., the Concurrent List and even till date there is no legislative entry for levying of
GST.

2.7. It is further submitted that the taxes which were being imposed in the previous fiscal regime
of Westeros consisted of separate indirect taxes inclusive of excise duty, sales tax, service
tax, etc. and now the idea of introducing various GST legislations is to impose tax on
‘Supply’ which is a combination of all the above mentioned taxes and this is to mitigate the
complications arising from previous cumbersome taxation policies and promote a simplified
taxation system.

2.8. Furthermore, it is humbly submitted that the current fiscal regime of Westeros exempt certain
products from taxation such as petroleum, industrial alcohol, and tobacco.32 Though, Goods
and Services Tax is not being imposed on the above mentioned items, these items are still
being sold as per the old fiscal regime, which means that in some way or the other Excise

30
(2006) 103 ITD 175 Ahd.
31
Article 246 Subject matter of laws made by Parliament and by the Legislatures of States.
(1) Notwithstanding anything in clauses ( 2 ) and ( 3 ), Parliament has exclusive power to make laws with
respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the
Union List).
(2) Notwithstanding anything in clause ( 3 ), Parliament, and, subject to clause ( 1 ), the Legislature of any State
also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule
(in this Constitution referred to as the Concurrent List).
(4) Parliament has power to make laws with respect to any matter for any part of the territory of India not
included (in a State) notwithstanding that such matter is a matter enumerated in the State List.
32
Petroleum & petroleum products would be subject to GST. [However, it has been decided that five products,
viz. petroleum crude, motor spirit (petrol), high speed diesel, natural gas and aviation turbine fuel would be kept
out of the purview of GST in the initial years of implementation]. In the case of tobacco and tobacco products,
the Centre alone would have the power to levy excise duty in addition to the GST.

Page | 9
 Duty, Sales Tax, Service Tax, etc. is still in operation. So now the Republic of Westeros has
SGST, CGST, IGST, Excise Duty, Sales Tax and Octroi,33 and this implies that the myth of
“One Nation One Tax” is completely bogus. The old VAT system has been partly
amalgamated and other system still continues to exist leading to the failure of the very
purpose of introducing GST. The problems which were in existence in the old fiscal regime
still exist as people of the Republic of Westeros have nowhere been relieved from the
cumbersome and highly convoluted system.

2.9. It is to be noted that different rates of taxation applies to different commodities as mentioned

under:

 0% - essential commodities, medicine

 2%- jewellery

 12% - Basic Items

 18% - Restaurants (Air- Conditioned)

 40% - Syn Tax- Motor Vehicles34

2.10. Moreover, in the famous case of Avinder Singh v. State of Punjab, 35 it was stated that
taxation is exaction and even expropriation and, therefore, the right to property is in peril
when a fiscal measure is afoot. Article 10 comes into play when law is made for purposes of
taxation and that law must comply with Part III. Arbitrariness must be excluded in the law,
for; if power is arbitrary it is potential inequality and Article 14 is fatally allergic to inequality
before the law. It shall be noted that the State of The North is functioning arbitrarily while
exercising its power to impose tax as it has effectively imposed income tax in the garb of
GST which is completely out of the ambit of jurisdiction of States as only Centre has been
provided with such power.

33
Taxes on entertainments and amusements to the extent levied and collected by a Panchayat or a Municipality
or a Regional Council or a District Council shall not be subsumed under GST. The local bodies of States could
continue to levy such taxes.
34
GST RATE SCHEDULE FOR CERTAIN GOODS [As per discussions in the GST Council Meeting held on
3rd June, 2017]
http://www.cbec.gov.in/resources//htdocs-cbec/gst/chapter-wise-rate-wise-gst-schedule-03.06.2017.pdf
35
( 1979) 1 SCC 137.

Page | 10
2.11. It is pertinent to note that the income tax imposed by the State of North in the garb of GST
has a discriminatory effect that has no basis in intelligible differentia or any rational nexus to
the object of the new taxation regime. Further, lack of government clarification as to whether
SGST or IGST provisions will apply to such transactions has contributed to continuing losses
to the petitioner, as various stake holders are left free to interpret the provisions as they will.
2.12. On these grounds, it has been contended the effect of the tax provisions have been contrary to
Articles 1436 and 19(1) (g).37 Further, it has allowed unjust enrichment for the State and lead
to a substantial reduction in the profit margin for the petitioner.
2.13. Moreover, in the recent judgment of Syndicate Bottles Pvt. Ltd v. State Of Tamil Nadu,38
it was stated that only on presumption and untenable assumption, Respondents have no right
whatsoever to interfere with the petitioner's right to carry on business either inside the State
or outside the State as they have every right to carry on business under Article 19(1)(g)39 of
the Constitution of India and also under Article 30140 of the Constitution of India which
guarantees Inter State Trade and Commerce to take place without any hindrance. In other
words, Article 19(1)(g) of the Constitution of India guarantees, to all citizens the right to
practice any profession or to carry on any occupation trade or business subject to reasonable
restrictions imposed by this State under Article 19(6) of the Constitution of India. Thus, when
the Constitution has guaranteed every citizen right to carry on any business whether rich or
poor it is only the State which can impose reasonable restrictions within the ambit of Article
19(6)41 of the Constitution of India, without which, on the basis of a circular, the respondent
cannot interfere with the petitioner's right to carry on business. In the instant case as well the
income tax imposed by The North is neither in furtherance of promotion of petitioner’s right
to free trade nor is covered by any reasonable restriction under Article 19 (1)(g).42 Thus, the
imposition of income tax in the garb of GST is undoubtedly against petitioner’s freedom to
carry trade, profession, etc. and shall be declared invalid.
2.14. It is further submitted that different slabs and different rates applicable under the GST for
different items, is something that is not seen anywhere else in the world, and could lead to

36
Article14 Equality before law The State shall not deny to any person equality before the law or the equal
protection of the laws within the territory of India Prohibition of discrimination on grounds of religion, race,
caste, sex or place of birth.
37
Supra note 18.
38
2016 SCC Online Mad 25397.
39
Supra note 2.
40
Article 301 Freedom of trade, commerce and intercourse Subject to the other provisions of this Part, trade,
commerce and intercourse throughout the territory of India shall be free.
41
Supra note 21.
42
Supra note 18.

Page | 11
 disastrous consequences. This sudden shift from the existing taxing pattern to that under the
GST which is termed as ‘GST-migration’ will be a very difficult one to go through, as the
procedural complexities involved in the GST pattern are huge and disastrous for the small
enterprises, with increased returns and compliances, coupled with lack of technical and IT
skills in many cases. Thus, it can be concluded that there exists multiple rates of taxation,
which is completely against the basic idea of GST. There shall have been no issues if there
would have been ‘one nation, one tax’ but adding up various indirect tax rates and
collectively calling it GST is not actually GST.
2.15. Accordingly, the Centre and the States have constantly been enacting laws within the spheres
enshrined in the Constitution. The power to tax was also clearly demarcated, without there
being any overlap in terms of the taxable event. The Centre and State historically have never
shared a field wherein both have a concurrent power to levy and collect a tax. Thus,
enactment of various GST legislations is completely against the very idea of federal nature of
the Constitution of Westeros.
2.16. Moreover, the State of North which has been opposing the GST since the very beginning,
when released its SGST Act, effectively imposed an income-tax in the garb of GST under its
SGST Act, which in itself is violation of the fundamental principle laid down by the Supreme
Court of Westeros, stating what could not be done directly cannot be done indirectly,
‘Colorable Legislation’.
2.17. Further, in the case of K.C. Gajapati Narayana Deo& Others v. The State Of Orissa, 43 it
was laid down “If the Constitution of a State distributes the legislative powers amongst
different bodies, which have to act within their respective spheres marked out by specific
legislative entries, or if there are limitations on the legislative authority in the shape of
fundamental rights, questions do arise as to whether the legislature in a particular case has or
has not, in respect to the subject-matter of the statute or in the method of enacting it,
transgressed the limits of its Constitutional powers. Such transgression may be patent,
manifest or direct, but it may also be disguised, covert and indirect and it is to this latter class
of cases that the expression ‘Colorable Legislation’ has been applied in certain judicial
pronouncements.”
2.18. Furthermore, in the landmark case of State of Bihar v. Kameshwar Singh, 44 a law has been
declared invalid on the ground of colorable legislation. It was observed that where the law
making authority is of a limited or qualified character obviously it may be necessary to

43
AIR (1953)Ori 185.
44
AIR (1952) SC 252.

Page | 12
 examine with some strictness the substance of the legislation for the purpose of determining
what it is that the legislature is really doing. In that case, the Court applied the well known
principle that in relation to Constitutional prohibitions binding a legislature, the legislature
cannot disobey the prohibition merely by employing an indirect method of achieving the
exact result. The same issue may be whether legislation which at first sight appears to
conform to Constitutional requirements is colorable or disguised. In such cases the Court may
have to look behind names, forms and appearances to determine whether the legislation is
colorable or disguised.
2.19. Similarly, in the case of Nageshwar v. A.P.S.R.T. Corporation, 45 it was stated that the
whole doctrine of colorable legislation is based upon the maxim that ‘you cannot do
indirectly what you cannot do directly’. The Court will look in the true nature and character
of the legislation and for that its object, purpose or design, to make law on a subject is
relevant and not its motive. If the Legislature has the power to make law, motive in making
the law is ‘irrelevant’.46
2.20. Moreover, The State of North which has been trying to impose income tax in the garb of GST
is similar to the facts of the above case where something which is forbidden to be done
directly is being done indirectly. It shall further be noted that though double taxation is
vicious and unjust in principle, and no statute will be so construed as to impose double taxes
if it can reasonably be avoided. But in the matter at hand it is quite clear that both Centre and
States are levying GSTs and the State of North is also imposing income tax, thus leaving no
doubt as to the reasonability of interpretation.
2.21. It is pertinent to note that the Republic of Westeros is already supposed to be on a value-
added tax regime. But under the current fragmented system, with the Centre and States
levying separate taxes, the value-added concept exists only on paper. State VAT and the
central taxes cannot be set off against each other. On one hand, we are on the road to
consolidate various taxes, big and small, into one common tax, i.e. GST and on the other
hand, State Governments may try to create new generation of taxes which is undesirable,
economically as well as ethically. Thus, though the major indirect taxes get subsumed, still
the people of Westeros will have to live with three formats of GST, i.e., CGST, UTGST and
SGST.

45
AIR (1959) SC 316.
46
Ibid.

Page | 13
2.22. Hence, the current fiscal regime under the Constitution permits double taxation by allowing
various GST legislations to exist and thus it violates Article 19 (1) (g) of the Constitution of
Westeros.

3. WHETHER THE 66TH CONSTITUTIONAL AMENDMENT VIOLATES OF THE

PRINCIPLE OF FEDERALISM EMBODIED UNDER THE DOCTRINE OF BASIC
STRUCTURE?
3.1. The Black’s Law Dictionary defines ‘federalism’ as ‘the legal relationship and distribution of
power between the national and the regional government within a federal system of
government.’47
3.2. K.C Wheare generally regarded as the Father of contemporary federal theories,
defined ‘federalism’ or ‘federal government’, as "the method of dividing power so that
general and regional governments are each within a sphere co-ordinate and independent."48
3.3. It is humbly submitted to the Hon’ble court that the arrangement in regard to the federal
system is that in which the power is divided between the Central and the State governments,
neither of which is subordinate to the other but are coordinate and independent within the
sphere allotted to them. It was further said that this arrangement represents the federal

47
Bryan A. Garner , Black’s Law Dictionary 644 (8th ed. 2015, Thomson Reuters).
48
Infra note 43.

Page | 14
 principle in the Constitution of India.49 But, now there have been so many modifications in
the application of the federal principle that it ceases to be of any significance,50 henceforth
the Constitution of Westeros cannot be termed ‘absolutely federal.’
3.4. It is humbly submitted to the Hon’ble Court that ‘Federalism’ in ‘Principle by Federal Concept’,
meant the idea of organisation of State whereby a compromise is achieved between concurrent
demands for union and for territorial diversity within a society, by the establishment of a single
political system, within which, general (Central) and regional (State) governments are assigned co-
ordinate authority that neither level of government is legally or politically sub-ordinate to the
other.51
3.5. In the landmark judgment of Ganga Ram Moolchandani v. State of Rajasthan52 the
Hon’ble Supreme Court reiterated: Indian Constitution is basically federal in form and is
marked by the traditional characteristics of a federal system, namely supremacy of the
Constitution, division of power between the Union and States and existence of independent
judiciary. Also, the Apex Court in ITC LTD v. Agricultural Produce Market 53,
Committee expressed a similar opinion.
3.6. The essence of federal form of government as stated in the Constitution of India is that the
Centre and the State Governments should be independent of each other in their respective,
constitutionally demarcated spheres of action. Once the fundamentals of the government are
spelt out, it becomes equally important that each of the government should be provided with
sources of raising adequate revenues to discharge the functions entrusted to it. For successful
operation of the federal government, financial independence and adequacy form the
backbone54 and hence, if states have been subjected with the power to levy their own state
GSTs, then they should not be subject to the central Act and should be given the ultimate
power to impose their state GSTs.
3.7. It is true that the Constitution of Westeros assigns to the Central Government too large a field
for the operation of its legislature and executive authority than is to be found in any other
federal Constitution. It is also true that residuary powers are given to the Central Government
and not to the states. These features capture the very essence of our Constitution’s federal
structure. The chief mark of federalism, as said by Dr. Hank Pym, lies in the partition of the

49
K.C. Wheare: Federal Government, 10 (4th Ed. 1963).
50
State of W.B. v. Union of India, AIR (1963) SC 1241.
51
M.P Jain, Indian Constitutional Law, 20 (6THed. 2011 ).
52
(2001) 6 SCC 89.
53
(2002) 9 SCC 232.
54
Anand, Mukesh, AmareshBagchi and Tapas K. Sen “Fiscal Discipline at the State Level: Perverse Incentives
and Pats to Reforms”, Working Paper No. 1, January, (2002).

Page | 15
 legislative and executive authority between the Centre and the units by the Constitution. This
is the principle embodied in Constitution of Westeros.
3.8. Similarly, in S.R. Bommai v. Union of India, 55the term “Pragmatic federalism” was used to
form the Constitution. Quoting Justice Ahmadi, “….It would thus seem that the Indian
Constitution has in it, not only features of a ‘pragmatic federalism’ which while distributing
legislative powers and indicating the spheres of governmental powers of State and Central
Governments, is overlaid by “strong unitary features”.
3.9. In the case in hand, there exist separate taxation laws for Central and State governments with
reference to the collection and imposition of the Goods and Services tax. However, the State
GST Act is subject to the Central GST Act formed by the Central Government.
3.10. In the case of State of West Bengal v. Kesoram Industries Ltd. and Ors.,56 the Hon’ble
Supreme Court reiterated the principle and held that federal structure of Constitution as a
factor in dealing with purported conflict between taxation powers of the union and the states
with historical bias in favour of strong centre and action of the central government in issuing
the dicta to the state is opposed to the constitutional scheme of state and centre functioning in
their respective fields. 
3.11. In the Reference Case 1 of 1964,57GAJENDRAGADKAR, C.J., it was observed by the
majority that, like other federal States, the Indian Constitution distributes powers between the
Union and the States and that in order to maintain this federal distribution, he characterized
the Indian Constitution as a ‘federal constitution’.
3.12. But as it is revealed from the case in hand that the State GST Act released by The North has
effectively imposed an income tax being a direct tax in the garb of GST which is a somewhat
a compilation of all the indirect taxes under its TN-SGST Act and has provided the definition
of supply under Section 7 as ‘supply means any income earned on goods or services or both
shall be deemed to be supply’ which in some or the other way has made the income of the
general public taxable once again in the garb of GST which is completely unconstitutional as
federalism is the basic structure of the Indian Constitution which permits the prevalence of
State as well as Centre Acts but only if it is for the benefit of the people at large.
3.13. Furthermore, it is humbly submitted that the ‘basic structure’ principle was first expounded in
1964 by J.R. Mudholkar, in the case of Sajjan Singh v. State of Rajasthan.58 The matter of
consideration was that whether making a change in Constitution can be regarded merely as an
55
AIR (1994) SC 191.
56
(2004) 266 ITR 721 SC.
57
Special reference no. 1 of 1964.
58
1965 SCR (1) 933.

Page | 16
 amendment, or would it be, in effect, rewriting a part of the Constitution, and if the latter
would be within the purview of Art. 36859? Article 368 of the Constitution of India does not
contain the power to amend, but merely establish the procedure for amending the
Constitution. Therefore, any amendment which is violative of the basic feature of the Indian
Constitution shall not prevail until and unless it is proved that it is not violative of the basic
feature.
3.14. In the Kesavananda Bharati v. State of Kerala 60 case, the Hon’ble Supreme Court ruled
that all provisions of the Constitution, including Fundamental Rights, can be amended.
However, the Parliament cannot alter the basic structure of the Constitution.
3.15. The federal character of public finance in India has its origin as far as the seventies of the last
century. Although, at that time, the country had a unitary form of government, some division
of functions and financial powers between the Centre and the State were found
administratively desirable.61Ever since then, the arrangements have been revised and
improved from time to time so as to make the administration less cumbersome and more
effective. The basic principle of Fiscal federalism has been formed so as to remove the
burden of responsibilities on the Centre and to give the powers to the individual states to
make laws for the public welfare. Fiscal federalism entails the division of responsibilities in
respect of taxation and public expenditure among the different layers of the government,
namely the Centre, the states and the local bodies, provided that they are in consonance with
the Central laws as per the federal system. Fiscal federalism helps governmental organization
to realize cost efficiency by economies of scale in providing public services, which
correspond most closely to the preference of the people.62 
3.16. Also amendment of Article 248(1)63(residuary power of legislation) under article 248(1) has
given exclusive power in to make any law in respect of any item not covered under State List
and Concurrent List, subject to provision under Article 246A64.Similarly, GST is one of the
subjects which is neither mentioned in the concurrent, nor in the state list. So, there arises no

59
368. Power of Parliament to amend the Constitution and procedure therefore:(1) Notwithstanding anything in
this Constitution, Parliament may in exercise of its constituent power amend by way of addition, variation or
repeal any provision of this Constitution in accordance with the procedure laid down in this article.
60
(1973) 4 SCC 225.
61
Srivastava, D.K. Revenue Sharing Among the Sub-National Governments: A modified Formula, ‘NIPFP
WORKING Paper No.1 cited by Agarwal P.K., Fiscal Federalism and Governance in India, 68, (New Delhi:
Oxford Publications,2000).
62
Ahluwalia, Montek “economic Performance of States in Post-Reforms Period”, Economic and Political
Weakly, 6, 1637-1648 (2001).
63
Article 248 (1) Parliament has exclusive power to make any law with respect to any matter not enumerated in
the Concurrent List or State List.
64
Supra note 2.

Page | 17
 question of challenging the concept of federalism under the basic structure doctrine as the
Constitution being the supreme authority clearly grants the power to the states to form the
legislations on the subject mentioned above i.e. GST.
3.17. The power to amend the Constitution is a legislative process and is included within the
plenary legislative power of the Parliament. Justice Sikri, while giving his judgment along
with other judges in the historic case of Kesvananda Bharti v. State of Kerela, 65put five
things in the list of basic structure and the fifth one was ‘federal structure’. Later on Justice
Khanna, agreed in principle with Sikri, C.J. Shelat, Grover, Jaganmohan Reddy, Hegde and
Mukherjee, that the amendment of the Constitution cannot have the effect of destroying or
abrogating the basic structure of the Constitution and hence the enactment of 66 th
Amendment Act (introduction of GST), which is violative of the basic feature of Indian
Constitution which is federalism shall be further amended, so as not to be violative of the
basic structure of the Constitution.
3.18. It is pertinent to note that in the case of Indra Nehru Gandhi v. Raj Narain,66 the Supreme
Court referred to Kesavananda Bharati,67 and accepted the majority opinion on the doctrine
of basic structure or framework of the Constitution.
3.19. The scope and extent of the application of the doctrine of basic structure again came up for
discussion before the Supreme Court in Minerva Mills Ltd. v. Union of India,68 and while
giving the judgment, Chief Justice Chandrachud, referred to the decision in Kesvananda
Bharti,69 and held that para 2 of the “summary” in that case correctly reflected the majority
view that Article 36870 did not enable Parliament to alter the basic structure of the
Constitution. It was observed that the Parliament could not, under the exercise of that limited
power, enlarge that very authority into an absolute power. Indeed, a limited amending power
was itself a basic feature of the Constitution and could not be destroyed as was done by of
Article 24671 of the Indian Constitution. Bhagwati. J. in his separate opinion agreed with the
65
Supra note 54.
66
1977SC0321.
67
Supra note54.
68
(1981)SCR (1) 206.
69
Supra note 54.
70
368. Power of Parliament to amend the Constitution and procedure therefore;
(1) Notwithstanding anything in this Constitution, Parliament may in exercise of its constituent power amend by
way of addition, variation or repeal any provision of this Constitution in accordance with the procedure laid
down in this article.
71
246. Subject matter of laws made by Parliament and by the Legislatures of States
(1) Notwithstanding anything in clauses ( 2 ) and ( 3 ), Parliament has exclusive power to make laws with
respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the
Union List)
(2) Notwithstanding anything in clause ( 3 ), Parliament, and, subject to clause ( 1 ), the Legislature of any State
also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule

Page | 18
 majority that the true ratio emerging from the majority decision in Kesavananda Bharati was
that Parliament in the exercise of its amending power could not alter the basic structure of the
Constitution.
3.20. It is further submitted to the Hon’ble court in the case of M. Nagraj v. Union of India72that
federalism is a part of basic structure of Indian Constitution which cannot be altered or
destroyed through Constitutional amendments without undergoing judicial review by the
Supreme Court and hence, any amendment, which seems to or is violative of the basic
structure of the Indian Constitution or any of its parts, per se shall not be accepted. It can be
argued that the forefathers of the Constitution had provided for the division of taxation
powers to enable the Parliament and the State Legislature to exercise their own freedom.
3.21. Therefore, the concept of GST itself may be challenged on the grounds of impinging upon the
absolute freedom of the states and Base Structure theory. Therefore it is strongly urged that
the 66th Amendment Act, is violative of the basic principle of Federalism.
3.22. In the aforementioned case M. Nagraj v. Union of India,73it was also submitted that the test
for judging the width of the power and the test for adjudicating the exercise of power by the
State concerned are two different tests which warrant two different judicial approaches.
3.23. Article 246A74 of the Constitution empowers the Centre and the States to levy and collect the
GST, which is an absolute violation of the principle of federalism since there is no legislative
entry for GST. GST is neither sales tax nor service tax, rather it is a tax on the supply of
goods and services and until now, there is no entry in either Centre or State List so as to
govern the collection and levying of the tax on ‘supply of goods and services’.
3.24. After quoting the views of the renowned Constitutional lawyer, A. V. Dicey, the learned
Chief Justice observed (para 52) : "In a sense, therefore, the Indian Union is federal. But, the
extent of federalism in it is largely watered down by the needs of progress and development
of a country which has to be nationally integrated, politically and economically coordinated
and socially, intellectually and spiritually uplifted."
3.25. Moreover, the term given to the Indian Constitution as ‘quasi-federal' is extremely vague as
it does not denote how powerful the Centre is, how much deviation there is from the pure

(in this Constitution referred to as the Concurrent List)

(4) Parliament has power to make laws with respect to any matter for any part of the territory of India not
included (in a State) notwithstanding that such matter is a matter enumerated in the State List

72
AIR( 2007) SC 71.
73
Supra note 66
74
Supra note 2

Page | 19
 ‘federal model’ or what kind of special position a particular quasi-federal federation occupies
between a unitary state and the federation proper.75
3.26. It is humbly submitted that the phrase ‘semi-federal’ was used for India in State of Haryana
v. State of Punjab.76In a semi-federal system of Government, which has been adopted under
the Indian Constitution, all the essential powers, both legislative and executive, have been
conferred upon the Central Government. True Federalism means the distribution of power
between a Central Authority and the Constituent Units. Dicey's concept of federalism is a
national Constitution for a body of States, which desire union and do not desire unity. 
Similarly, the Constitution of India in the same case was called ‘more unitary than federal’.
3.27. Therefore, keeping in mind the supremacy of the Constitution of Westeros it is humbly
submitted to the Hon’ble court that the 66th Constitutional Amendment is clearly violative of
the principle of federalism embodied under the doctrine of basic structure which deems to be
the sheer violation of the Constitution of Westeros which is the supreme of all.

PRAYER

Therefore, in light of the issues raised, arguments advanced and authorities cited, it is
humbly prayed that this Hon’ble Court may be pleased to hold, adjudge and declare that:
1. The decision of the High Court of North be quashed.
2. The TN-SGST Act is invalid.
And/or
Pass any other order which this Hon’ble Court may deem fit in the light of justice, equity and
good conscience. For this act of kindness, the petitioner shall as duty bound forever pray.

All of which is most humbly prayed.

75
M.P Jain- Indian Constitutional Law 347-357 (3rd ed., 1978 Lexis Nexis).
76
AIR (2002) SC 685.

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Counsel for Petitioners

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