oppn parties GST Compensation: An Act Of God Does Not Absolve The Head Of The Family From Responsibilities

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  • Neha Bora was subsequently released and Dipke is to appear before a magistrate today at noon
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  • Finance Minister Nirmala Sitharaman said India's trade imbalance with China was growing sharply and attributed the problem partly to restrictions on Indian goods and services entering the Chinese market. China subsequently said it was ready to work with India to address mutual economic and trade concerns; India's trade deficit with China reached $69 billion in the first half of FY2026–27, up 27% year-on-year
  • Indian equity benchmarks extended their recovery on Friday, with the Sensex rising 413.66 points to close at 74,729.27 and the Nifty 50 gaining 148.80 points to settle at 23,146.15. Information technology shares, including Tech Mahindra, Infosys and TCS, helped lift the indices
  • India defeated Zimbabwe by four wickets in the opening women's T20 International in Raipur, taking a 1–0 lead in the three-match series. Deepti Sharma and Niki Prasad combined in an 82-run stand after India's top order collapsed, helping the hosts chase down Zimbabwe's total of 114 for five
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  • The Supreme Court issued notices to the Election Commission of India, Delhi Police and opposition leaders, including Rahul Gandhi and Akhilesh Yadav, in separate petitions concerning electoral-roll revision and protests held in Delhi on October 10–12. The court also directed the preservation of CCTV footage linked to allegations of police excesses
  • The Supreme Court ruled that a person converting from Hinduism to Islam cannot automatically claim backward-class reservation benefits in the new religious community solely on the basis of their previous caste status. The judgment upheld the Madras High Court's decision striking down a 2024 Tamil Nadu government order that permitted such certification for specified communities
  • The Election Commission of India ordered a Special Summary Revision of electoral rolls in 14 states and three Union Territories, using January 1, 2027, as the qualifying date for voter eligibility. The draft rolls are scheduled for publication on November 12, claims and objections will be accepted until December 11, and the final rolls are due on January 4, 2027
Delhi HC refuses to ban CJP's Tiranga rally at Central Park in Connaught Place today /////// Police says will control and regulate it /////// NDMC closes the park for the public on Friday and Saturday
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GST Compensation: An Act Of God Does Not Absolve The Head Of The Family From Responsibilities

By Sunil Garodia
First publised on 2020-08-28 09:03:02

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator. Author of Cyber Scams in India, Digital Arrest, The Money Trap and The Human Hack

When the GST was being introduced, many states refused to come on board for the simple reason that they feared that any shifting to 'one nation one tax' system would result in a shortfall in their tax collections compared to the system of excise, VAT and several other taxes that was being followed then. The Centre had placated them and brought them on board by promising to make good the shortfall for five years. A cess was levied on GST for the purpose, but it was not made clear whether the states were to be compensated only from the amount collected through the cess. One thing was clear though - that the onus was on the Centre to make good any shortfall suffered by the states for a period of five years.

The Centre now wants to renege on the promise citing "an act of God." The Covid-led disruption might be a handy excuse to lay the blame of the precarious state of the economy at God's door, but the Centre has withheld payments to states from the third quarter of the last fiscal, when problems of low consumption, and hence low tax collections, first started raising their head. The Centre and the states are like a family, with the Centre being the head. Does the head of the family leave other members of the family to their own devices in times of crises, even if they are acts of God? In fact, in such circumstances, the responsibility of the head of the family increases manifold.

None of the solutions provided by the Centre for states to tide over the difficult times show that it is acting as the head of the family or is trying to mitigate the problems they are facing. It wants the states to either borrow a part or the entire amount of the shortfall (at reasonable rates of interest) from a special window to be created by the RBI upon the Centre's guarantee. What does this mean? It simply means that the states will have to borrow despite the money logically being theirs and then pay interest on it. This is highly unfair. Ideally, since it had promised to compensate them for the shortfall, the Centre should borrow and compensate the states. 

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