Abstract
This article studies the evolution of the Parliament's experience and attempts to incorporate a tax on services under its purview and also the expansion of the scope of sales tax to included services. The paper begins with the attempts of the State legislatures to expand the ambit of sales tax and the subsequent decision of the Supreme Court in the case of Gannon Dunkerley. The paper has traced the evolution of the State's attempts to continuously expand the scope of its legislative authority to tax services and discusses the obvious contravention of the Federal structure and division of legislative competence which it has resulted in, and perhaps has been overlooked by the Judiciary in a series of decisions on the matter. Subsequently, it highlights the significant contemporary development to tax different aspects of a single commercial transaction under both the service and the sales tax nets between the Union and the state Governments and the levy of service taxes upon transactions which are clearly of different character. With the highest judicial authority of the land overlooking vital distinctions and ignoring the balance of competence between the Union and the states, even more commercial transactions may fall susceptible to the Parliament's urge to maximise revenue in this manner. A development, which the authors argue, was perhaps dealt much better by the early benches of the Supreme Court.
Recommended Citation
Padmanabhan, Anand and Padmanabhan, Giridharan
(2012)
"Sale for You, Service for Him, Both for the Taxman,"
National Law School of India Review: Vol. 23:
Iss.
2, Article 6.
Available at:
https://repository.nls.ac.in/nlsir/vol23/iss2/6
