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In our Update dated 10 June 2021, we had apprised you of the divergent views of division bench of the Bombay HC on the constitutional validity of intermediary service provision under GST. While Justice Ujjal Bhuyan had opined that intermediary service to be unconstitutional, Justice Abhay Ahuja had a dissenting view, upholding the constitutional validity of the intermediary service provision. In his dissenting view pronounced on 16 June 2021, Justice Ahuja has inter alia made following broad observations:
Article 286 of the Constitution
Scheme of the IGST Act
In light of the above observations, Justice Ahuja, agreeing with the judgement of the Gujarat HC in the case of Material Recycling Association of India vs. UOI and Ors. [R/Special Civil Application No. 13238 of 2018 with R/Special Civil Application No. 13243 of 2018] held that the legitimacy of Section 13(8)(b) or Section 8(2) of the IGST Act cannot be doubted. Accordingly, the Constitutional validity of Section 13(8)(b) or Section 8(2) of the IGST have been upheld.
Failing to attain finality on the matter at hand due to the contrary views of the Division Bench, the same has now been directed to be placed before the Chief Justice on the administrative side for his decision.
The information provided in this update is intended for informational purposes only and does not constitute legal opinion or advice. Readers are requested to seek formal legal advice prior to acting upon any of the information provided herein. This update is not intended to address the circumstances of any particular individual or corporate body. There can be no assurance that the judicial/ quasi judicial authorities may not take a position contrary to the views mentioned hereinrra quis.
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