“THE GOODS AND SERVICES TAX JOURNEY IN INDIA: AN OVERVIEW”

Dissertation submitted to
SVKM’s Narsee Monjee Institute of Management Studies (NMIMS)
in partial fulfilment of the requirements
for the degree of
B.B.A., LL.B. (Hons.)

By
Parichaya Reddy Baddam

Under the Guidance of

Prof. Viplav Baranwal

NMIMS School of Law

Bengaluru
2023-2024

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Certificate

The work described in this dissertation entitled “The Goods and Services Tax Journey in
India: An Overview” has been carried out by Mr. Saaransh Shukla under my supervision. I
certify that this is his bonafide work. The work described in this dissertation is original and
has not been submitted for any degree to this or any other university.

Date: Guide:
Place: Bengaluru
Assistant Professor

Head,
Department of Law

Dean, KPMSoL

SVKM’s NMIMS, School of Law

Bengaluru
2023-2024

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Statement by the Candidate

This is to submit that this written submission in my dissertation entitled “The Goods and
Services Tax Journey in India: An Overview” represents my ideas in my own words and
where others’ ideas or words have been included, I have adequately cited and referenced the
original sources. I also declare that I have abided by all the principles of academic honesty
and integrity and have not misrepresented or fabricated or falsified any idea/ data/ fact/ source
in my submission. I understand that any violation of the above will be cause for disciplinary
action by the School and can also evoke penal action from the sources which have thus not
been properly cited or from whom proper permission has not been taken when needed.

This dissertation encompasses the information generated by me based on work carried out in
the school. I assure and hold full responsibility for its genuineness.

Ms. Parichaya Reddy Baddam

Forwarded Through

Academic Guide (s)

1. Name of the Guide : Prof. Viplav Baranwal
Designation: Assistant Professor of Law Department of Law
NMIMS School of Law,
Bannerghatta Main Road,
Kalkere,
Bengaluru - 560083

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 ACKNOWLEDGEMENT

I would like to acknowledge my sincere gratitude and warmest thanks to my guide and
Assistant Professor of Law, Prof. Viplav Baranwal for his patience and constant support
throughout this dissertation. I am extremely grateful for his encouragement throughout the
process. I am thankful for his invaluable guidance, support and suggestions to make this
dissertation a successful one. I am really inspired by his way of analyzing legal issues and
would always be thankful to him for the knowledge and the advice he has extended to me. I
am appreciative for his valuable co-operation and encouragement.

I would also like to thank our Program Chairperson, Dr. Tanmeet Kaur Sahiwal and Campus
Director, Dr. Narayani Ramachandran and the Sr. Assistant Librarian Mr. Vansatha D and all
the library staff for providing access to various resources for the completion of this research
project along with their continued support towards me. Finally, I would like to thank my
batchmates and my parents for all the unconditional support in this very intense and crucial
academic year.

Parichaya Reddy Baddam

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 LIST OF ABBREVIATIONS

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 LIST OF CASES

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 TABLE OF CONTENT

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 ABSTRACT

India's economy is centred on taxes, and the introduction of the Goods and Services Tax
(GST) on July 1, 2017, is noteworthy as one of the biggest tax reforms in the country's history
since its independence in 1947. The fundamental purpose of implementing GST was to unify
numerous indirect taxes, such as the Central Excise Tax, VAT/Sales Tax, and Service Tax,
into a uniform tax structure. The main philosophy of GST focuses on the notion of "one
nation, one tax, one market." Understanding the nuances of GST is crucial, as a lack of
information about the legislation may lead to penalties. In India's centralized democratic
framework, GST is controlled simultaneously by the national and state administrations via
CGST and SGST, respectively, signifying a significant surge towards the nation's growth.
GST functions as a uniform indirect tax, influencing many businesses and sectors of the
economy directly. Its ratification is a noteworthy accomplishment in the domain of
comprehensive indirect taxation reform, creating a unified tax framework with a consistent
rate for products and services. The projected advantages of GST entail promoting a business-
friendly environment by reducing prices and regulating inflation rates. Globally, 160 nations
have adopted GST to prevent tax cascading within their economies. Items and service tax,
frequently equated to a value-added tax, primarily pertains to items and services intended for
domestic or personal consumption. This dissertation attempts to analyse the predicted effect
of GST on the Indian tax landscape, offering a brief summary of its historical context, tax
system, background, key characteristics, and its economic repercussions across several
sectors. The research employs an exploratory method, relying on secondary data gathered
from trustworthy institutions such as journals, periodicals, newspapers, and reliable websites.

Key Words: Goods and Services Tax (GST), Indirect tax, Value-added tax, Tax reforms,
India's economy, CGST (Central Goods and Services Tax), SGST (State Goods and Services
Tax).

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 CHAPTER I: INTRODUCTION

The introduction of Goods and Service Tax (GST) is a fundamental change in India's tax
environment, which seeks to streamline and simplify the tax structure. GST, which is known
as Goods and Services Tax, is derived from the Latin term "taxare," meaning to estimate. The
introduction of the Goods and Services Tax (GST) in India was once scheduled for June 2016
but was ultimately put into effect on July 1, 2017, as envisaged by the Constitution (One
Hundred and Twenty-Second Amendment) Bill, 2014. This transformational tax system
consolidates various federal and state taxes into a unified charge, eradicating the
complications of cascading or double taxation.

GST also facilitates the formation of a common national market for products and services.
India, recently was known as one of the world's fastest-growing economies, has undergone
tremendous progress, propelled by market reforms, inflows of foreign direct investment, and
prospering industries such as information technology and real estate. With an expanding
presence of multinational firms and cross-border commerce, there is a demand to increase the
nation's tax system. The aim of tax systems is to raise money in an equitable, effective, and
efficient manner without altering the nature of the market. Being implemented by 160
countries worldwide, GST offers a revolutionary tax strategy aimed at bolstering revenue
collection without inflicting superfluous obligations on taxpayers. India's implementation of
GST complies with worldwide norms, following in the footsteps of nations like France,
Russia, and China, which introduced GST earlier. While other countries, like Canada, also
implemented a dual GST system, levying both federal and provincial taxes. India follows
Canadian Type of Taxation system.

India's GST model is a complete, multi-stage, destination-based tax applied to every value
addition in the supply chain. GST promises to streamline the tax base, reduce exemptions, and
simplify the tax system, benefiting both sectors and consumers. It will be collected via three
channels: CGST by the central government, SGST by state governments for intra-state
transactions, and IGST by the federal government for interstate transactions.

A comprehensive tax system like GST is necessary for income distribution and producing
resources to support public services and infrastructure development, which are needed for
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economic growth. The adoption of GST would change the tax structure in India, replacing
several taxes collected by National and state governments with a single tax on products and
services at each level of the supply chain. This change to GST would assist firms in claiming
tax credits, helping to smooth the flow of products and services throughout the economy.
Administrative obligations for GST would primarily fall under a single body, facilitating
efficient tax collection and compliance. The collected GST, which is also referred to as value-
added tax (VAT) in other countries, would be paid to the government by companies, which
will eventually build a more transparent and effective tax system for India's economic
progress.

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