An NGO has moved the Madras high court seeking direction to the Centre to implement the provisions of the GST (goods and services) Act and release Rs 12,250 crore pending compensation to Tamil Nadu immediately.
Poovulagin Nanbargal represented by its managing trustee G Sundarrajan said that refusal on part of the central government to release the dues are unconstitutional.
According to the petitioner, as per section 7 (2) of the GST Act the compensation payable to a state shall be provisionally calculated and released at the end of every two months. The same will be finally calculated at the end of the year based on the revenue as audited by the comptroller and auditor general of India.
Citing the press statement released by the chief minister of Tamil Nadu dated August 31, the petitioner submitted that the state agreed to the implementation of GST and decided to support the legislation only on the unequivocal commitment given by the central government to compensate the state for any revenue loss. Such compensation is clearly assured in the Act itself, the petitioner said.
The statement further revealed that no GST compensation has been released by the Union government to Tamil Nadu for the shortfalls in revenue collection since April 1, 2020, he added. “As per the CM’s statement a total of Rs 12,250 crore is due to Tamil Nadu as compensation for the shortfall in GST collections of which Rs 11,459.37 crore has accrued from April to July,” the NGO said.
It said that such acts of the Union government would amount to violation of fundamental right of people of Tamil Nadu to life and livelihood guaranteed under the Constitution. The plea filed as PIL is likely to be taken up for hearing in the first week of October.