Is GST Council Notification Invalid?
SEVERAL experts told me, "Excise duty must have been saved, but the notification giving effect to Section 12 of the Constitution (One Hundred and First Amendment) Act, 2016, is invalid."
Why?
As per Section 1(2) of the Constitution (One Hundred and First Amendment) Act, 2016,
It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the commencement of that provision.
In exercise of the powers conferred by sub-section (2) of Section 1 of the Constitution (One Hundred and First Amendment) Act, 2016, the Central Government appointed the 12th day of September, 2016 as the date on which the provisions of Section 12 of the said Act shall come into force - by a notification dated 10th September 2016.
By another Notification dated 16th September 2016, the Government notified the other sections of the Act, including Section 1. Now, when Section 1 was notified only on 16th September 2016, how can the powers under that section be used to notify Section 12 on 10th September? There seems to be some problem here. This is a Catch-22 situation. Unless you notify Section 1, the Act does not come into force, but you cannot notify Section 1 unless the Act comes into force. An editorial colleague told me that such Acts can never be notified. But this is a problem as old as the Laws themselves.
Section 1(3) of the Employees' State Insurance Act, 1948 stipulates, "It shall come into force on such date or dates as the Central Government may, by notification in the Official Gazette, appoint, and different dates may be appointed for different provisions of this Act.. "
Section 1(2) of the Official Languages Act, 1963 states, "…… Act shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act."
There are several Acts like these and all of them have come into effect by notifications issued by the government in exercise of the powers under Section 1, which had not come into existence. Example - "In exercise of the powers conferred by Sub-section (2) of Section 1 of the Indian Divorce (Amendment) Act, 2001 (51 of 2001), the Central Government hereby appoints the 3rd day of October, 2001 as the date on which the said Act shall come into force."
The Real Estate (Regulation and Development) Act, 2016 solved this problem by not notifying the Section 1at all. They notified from Section 2. It is assumed that Section 1 automatically comes into existence!
These are all examples of bad drafting by our all-knowing babus who can get away with anything, but recently there was a brilliant drafting of the Companies Act 2013 in which Section 1 reads as:
1. (1) This Act may be called the Companies Act, 2013.
(2) It extends to the whole of India.
(3) This section shall come into force at once and the remaining provisions of this Act shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of this Act …….
So, the Section 1 comes into force immediately on the Bill becoming the Act and all other Sections can be notified at Government's will, pleasure and convenience. Whoever drafted this must have foreseen the problem of notifying the Act and came up with his brilliant solution. He deserves a Bharat Ratna. This is how the Section 1 in all the Acts has to be drafted. The Ministry of Law and the Department of Revenue must utilize the services of that officer who drafted this provision. Incidentally this is not his invention - what I praise him for is finding out the correct words, which were used earlier.
Sixty years ago, the The Immoral Traffic (Prevention) Act, 1956 had an identical provision. So did the Maharashtra Medical Council Act, 1965 and long before the Suppression of Immoral Traffic Act, 1933.
So, the Revenue Department might be technically wrong in notifying Section 1 on 16th September and Section 12 on 10th September, but this is a mistake we have been carrying on since 1948 (as my quick research reveals - it could even be earlier.) and we can't blame anyone now. But in future every lawmaker should follow the example of Companies Act 2013.
Next time you go to a Central Excise/Customs/Income Tax office, you may be greeted with the above board.
CBI Director Anil Sinha recently wrote to the Revenue Secretary Dr. Hasmukh Adhia,
In order to deal more effectively with complaints of corruption against public servants in various agencies of Deptt of Revenue, Ministry of Finance, Govt. of India, it is necessary to proactively solicit information from public. As such, a message on following lines in Hindi/local language and English in black colour on yellow background may please be painted at prominent public places in all the Government offices of income Tax, Customs & Central Excise, Enforcement Directorate etc. across the country.
This will encourage citizens facing demands of bribe to instantly report to the local CBI Anti-Corruption Branches. It is requested to issue directions to the authorities concerned in Income Tax, Customs & Central Excise, Enforcement Directorate etc. to have the aforementioned message painted (not pasted) in coordination with local Head of CBI Anti-Corruption Branches. All CBI Branches are being separately instructed to liaise with local authorities of Department of Revenue for prompt follow up action.
The CBDT has consequently issued instructions to all the Principal Chief Commissioners to ensure that the display board is put in place within 30 days. CBEC should also be issuing such a direction.
CBDT F.No.A-27023/21/2016-AdVI(A)., Dated: September 19 2016