Divergent opinion on constitutional validity of Section 13(8)(b) IGST Act pertaining to intermediary services

Last updated: 17 June 2021

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Quick Summary

The Bombay High Court, in a divided opinion, considered the constitutional validity of Section 13(8)(b) of the IGST Act concerning intermediary services. Justice Ujjal Bhuyan found the section unconstitutional and invalid, arguing it wrongly taxes export of services as local supply. However, Justice Abhay Ahuja disagreed, leading to the matter being referred to the Chief Justice. This ruling contrasts with a previous Gujarat High Court decision.

Court :
Bombay High Court

Brief :
The Hon'ble Bombay HC in Dharmendra M. Jani v. Union of India [W.P. No. 2031 of 2018 dated June 09, 2021] Justice Ujjal Bhuyan held that Section 13(8)(b) of the Integrated Goods and Service Act, 2017 ('IGST Act') is ultra vires of Articles 14, 19, 245, 246, 246A, 269A and 286 of the Constitution of India and also ultra vires the provision of Central Goods and Service Tax Act, 2017 ('CGST Act'), IGST Act and Maharashtra Goods and Service Tax Act, 2017 ('MGST Act'). Justice Abhay Ahuja disagreed with the Justice Ujjal Bhuyan, now the matter is to be placed before Hon'ble the Chief Justice on the administrative side for doing the needful.

Citation :
W.P. No. 2031 of 2018 dated June 09, 2021

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