New Delhi: The Supreme Court on Thursday in its verdict upheld the decision of the Gujarat High Court, quashing the levy of GST on ocean freight under reverse charge in the case of Mohit Minerals Private Limited. A bench of the Supreme Court, headed by Justice DY Chandrachud passed the order. “Recommendations of the GST Council aren’t binding on Centre and States. It only has a persuasive value,” the Supreme Court said, in its judgement. The Parliament and the state legislatures possess equal powers to legislate on GST. It is for the GST Council to advise suitably, the Supreme Court said. The top court said that the recommendations of the GST Council are not binding on the Union and states for many reasons. The reasons are the deletion of Article 279B and the inclusion of Article 279(1) by the Constitution Amendment Act 2016 indicates that the Parliament intended for the recommendations of the GST Council to only have a persuasive value, particularly when interpreted along with the objective of the GST regime to foster cooperative federalism and harmony between the constituent units, the Supreme Court said. After the Supreme Court passed the judgement, Abhishek A Rastogi, partner at Khaitan and Co, who argued for petitioners before the Gujarat High Court, Supreme Court and various other courts for this landmark decision, said that it opens up the question whether different states could have different rate structure for a similar supply and such a deviated position would fundamentally affect the concept of one nation one tax. “The court ruling is very clear that the role of the GST Council will be recommendatory in nature and hence the statutory provisions will have to cross the constitutional barrier, if required. In other words, the statutory provisions cannot take the shield that such changes were based on GST recommendation. This opens up the question whether different states could have different rate structures for a similar supply and such a deviated position would fundamentally affect the concept of one nation one tax,” he said. (UNI)