Page 23 - Banking Finance June 2023

LEGAL UPDATE

Legal

'No GST exemption on pil- landmark 'Kesavananda Bharati' judg- case, sons of the two former judges
ment barring the Parliament from fastidiously imbibe the basic structure
grims' accommodation
amending the basic structure of the in their approach to constitutional
outside a religious place Constitution, including fundamental cases.
rights, the Supreme Court uploaded on
A charitable trust providing accommo-
its website the entire records of the
dation to pilgrims visiting Ambaji Apex court alters ap-
watershed ruling along with the 11
Temple in a building located outside
different opinions given by the mem- proach to resolving trans-
the boundary of the religious place will
bers of the SC's largest-ever 13-judge
not get GST exemption, rules Gujarat's fer pricing disputes
bench.
Authority for Advance Rulings (GAAR). In a significant ruling, the Supreme
The bench, comprising then CJI SM Sikri Court on April 19, 2023, set aside an
The applicant Ahmedabad based
and Justices JM Shelat, KS Hegde, AN earlier Karnataka High Court ruling
Nandini Ashram Trust provides accom-
Grover, AN Ray, PJ Reddy, DG Palekar, which held that in all cases where the
modation to pilgrims who visit the
HR Khanna, KK Mathew, MH Beg, SN
Ambaji Temple and the room rent is Rs. Income Tax Appellate Tribunal (ITAT)
Dwivedi, BK Mukherjea and YV
1,000 per day. It is also engaged in has determined the arm's length price
Chandrachud, by a slenderest 7-6 mar- (ALP), the determination of the ITAT is
providing a wide range of professional
gin had ruled that under Article 368 of
consulting services such as architec- final and cannot be the subject matter
the Constitution "the power to amend
ture, engineering, planning, urban de- of scrutiny by the High Court.
does not include the power to alter the
sign, landscape, sustainability, re- The apex court held that any ALP de-
basic structure or framework of the
search and art, building design, interior termined outside the purview of rel-
Constitution so as to change its iden-
design, surveying, environmental sci- evant transfer pricing (TP) provisions
tity".
ences, project management and can be considered as 'perverse' and
The 'basic structure doctrine' was
project economics. It moved to AAR to may be considered as a substantial
agreed to by CJI Sikri, and Justices
seek advance ruling on whether it question of law.
Shelat, Hegde, Grover, Khanna, Reddy
needs GST registration and whether The Supreme Court ruling shall have
and Mukherjea. Those who disagreed
the services come under the purview far-reaching implications for taxpayers
were Justices Ray, Palekar, Mathew,
of GST regime.
Beg, Dwivedi and Chandrachud. While in India, including on a large number
of cases covered by High Court rulings
Justice Mathew's son K M Joseph is a
SC marks 50 yrs of historic
sitting SC judge, Justice Chanrachud's that had relied on the Karnataka HC
'basic structure' ruling ruling.
son is the present CJI. In contrast to
Celebrating the 50th anniversary of its their fathers' views in the Kesavananda The SC ruling has restored TP issues to
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