MAY 02, 2018

By Vijay Kumar

THE other day, a trader asked me what the GST rates on tamarind seeds were. A little research revealed that there were clarifications on tamarind kernel, not on tamarind seeds and obviously, there is a tamarind tree of difference between the two.

The Government's FAQ had clarified as:

But my trader was selling tamarind seed and he went through the whole laws of GST to find out if his seeds were exempted. He knew about advance ruling but was scared to go there, because he said the fees for application and appeal were too high and the obvious and binding decision against him, with no further appeal! Then he asked me how many laws he should know to understand GST.

This trader was turning difficult and I told him, I was planning to retire. With his tinge of tamarind brilliance, he told me that this is the time to start practice, not retire, because happy days are ahead – for the consultants. Tamarind seed may be small but the litigation is bound to be big. Since he asked me about the number of laws, I tried checking it up.

I found that you have to read the:

1. Constitution (One Hundred and First Amendment) Act, 2016.

2. Central Goods and Services Tax Act, 2017.

3. Central Goods and Services Tax (Extension to Jammu and Kashmir) Act, 2017.

4. Integrated Goods and Services Tax Act, 2017.

5. Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Act, 2017.

6. Goods and Services Tax (Compensation to States) Act, 2017

7. Central Goods and Services Tax Rules, 2017, which was amended eighteen times in the last ten months.

8. Integrated Goods and Services Tax Rules, 2017.

9. Seventy five Central Tax Notifications issued in 2017.

10. Twenty one Central Tax Notifications issued in 2018.

11. Forty seven Central Tax (Rate) Notifications issued in 2017.

12. Ten Central Tax (Rate) Notifications issued in 2018.

13. Twelve Integrated Tax Notifications issued in 2017.

14. One Integrated Tax Notification issued in 2018.

15. Fifty Integrated Tax (Rate) Notifications issued in 2017.

16. Eleven Integrated Tax (Rate) Notifications issued in 2018.

17. One Compensation Cess Notification issued in 2017.

18. Seven Compensation Cess (Rate) Notifications issued in 2017.

19. One Compensation Cess (Rate) Notifications issued in 2018.

20. Twenty six Circulars issued by the Board in 2017.

21. Forty three Circulars issued by the Board in 2018.

22. Eleven orders issued by the Board in 2017.

23. Two orders issued by the Board in 2018.

The list is by no means exhaustive or accurate. Apart from the above, there are Acts, Rules, Notifications, circulars etc., for the States and Union Territories separately. The above-mentioned laws are being interpreted by the trade, consultants, Officers and Courts and in the fortunate future, we will see hundreds of interpretations which will produce thousands of cases, which will also become part of the law. Truly gigantic!

If you can read all these and understand them, perhaps you will have some knowledge about GST to which the great interpreters may not eventually agree. But the Prime Minister says GST is a Good and Simple Tax – of course he is right. After all, there are thousands of complicated laws, which we don't know about, let alone understand; but we are expected to know them and obey them. In an ideal situation, government should be of laws and not of men.

Justice Allen of the US Supreme Court once remarked, "A little too much law and you turn the moderate drinker into a dipsomaniac, the agnostic into a blasphemer, the enlightened employer into a grad grind and a flirt into a prostitute"

Chief Justice Chagla once remarked in a conference, "in the modem and complex society every act of ours is controlled by some law, every minute of our living existence is spent in conforming to or - and I hope that is very rare-contravening some rule or regulation enacted by the mighty State ."He added, "in this conference, however, the Government is not represented as a publisher. Otherwise, all the stalls would be taken up by the different laws that it has published for the betterment of humanity".

Chief Minister Morarji Desai was not impressed and he wrote to Chagla, "I did not know that rare minutes of your existence are spent in contravening some rule or regulation enacted by the State. I should have thought that at least the Chief Justice should be in a position to say that he scrupulously observes all rules and regulations and that, whenever he has any doubt, he enquires and makes sure what the rule on the point is."

Continuing with Chagla will perhaps make sense in our exploration of GST. Chagla wrote to Morarji, "I should have thought that the Director of Publicity has more important things to do than to scrutinise every utterance of the Chief Justice in order to find out whether he has said anything against Government which should be brought to the notice of his employers. May I humbly suggest that he should spend a little more time in elucidating the law to the citizens, so that they should know what their duties and obligations are-a subject about which many are woefully ignorant?"

Chagla added, "After reading your letter I have definitely come to the conclusion, to which I was being driven more and more every day, that the Government of Bombay do not relish any criticism-so much so that they cannot tolerate even a humorous remark. Government possess the monopoly of wisdom, statesmanship, and patriotism, and anyone who differs from them is either a fool or a knave. You do not realise how independent thinking is fast disappearing from Government officials. Several of them have told me that they dare not express their honest opinion because if they did so, they would immediately lose their jobs." This happened in 1950. Obviously, things have not changed much. What are you talking about good old days – good days are ahead, not behind.

Is GST complicated? Yes, but so is every law and every lawyer. You will have to learn to live with it. There is nothing unfair, nothing unjust. Remember tax and equity are strangers, but certainly need not be sworn enemies.

The good news is there is money coming in; the monthly collection of GST has exceeded ONE LAKH CRORES and the governments – Central as well as States, are smiling. Don't worry about minor irritants like the rate of tax on tamarind seeds.

Could I add to the gross knowledge on GST possessed by the tamarind seed (which is not kernel) trader? The website of my Bar Council proclaims Lawyers are the only persons in whom ignorance of the law is not punished.