The Supreme Court's ruling in Union of India vs Mohit Minerals (2022) fundamentally altered the nature of cooperative federalism in India's GST framework. Discuss.

Q. The Supreme Court's ruling in Union of India vs Mohit Minerals (2022) fundamentally altered the nature of cooperative federalism in India's GST framework. Discuss. (15 marks, 250-350 words)

The 101st Constitutional Amendment Act, 2016 created a rare instance of simultaneous taxing power for the Union and the States under Article 246A [2]. In Mohit Minerals (2022), the Supreme Court read this shared sovereignty to hold GST Council recommendations persuasive, not binding [3] — reframing, though not overturning, cooperative federalism.

What the Court held - While striking down reverse-charge IGST on ocean freight in CIF imports as double taxation, the Court examined the Council's constitutional status [3]. - Article 279A makes the Council a joint forum — Union one-third weight, States two-thirds, decisions by three-fourths majority [1] — but Article 246A vests actual legislative power in Parliament and State legislatures [2]. - Recommendations are therefore the product of "collaborative dialogue", not binding edicts [3].

How it altered cooperative federalism - Restored State autonomy: a State may deviate through its own SGST law rather than merely execute Council decisions. - Recast the mode of consensus from quasi-command to bargaining, giving smaller States real negotiating leverage. - Arrived when fiscal trust was strained — the compensation guarantee lapsed in June 2022, with cess continuing only for loan repayment.

Yet the change is one of degree, not kind - The Council's consensus practice has largely held; no State has fractured the common rate structure. - Revenue buoyancy persists, with monthly gross collections consistently near ₹1.9–2 lakh crore [4] — harmonisation survived the ruling. - Divergence risk stays latent but real: unilateral rate changes could revive the pre-2017 fragmented market.

The judgment relocated the Council from a supra-legislature to a deliberative forum, making federal dialogue rather than hierarchy the source of GST's legitimacy. Operationalising the dispute-settlement mechanism under Article 279A(11) and improving transparency in Council proceedings [1] can convert persuasive authority into durable consensus — realising the cooperative, shared-sovereignty federalism the 101st Amendment envisaged.

(~330 words)

Sources: 1. GST Council — official portal, Goods and Services Tax Council — Article 279A composition, one-third/two-thirds vote weightage, three-fourths majority, dispute-settlement mandate 2. PRS Legislative Research — The Constitution (101st) Amendment Act, 2016 allows both centre and states to levy GST — simultaneous taxing power under Article 246A 3. Union of India v. M/s Mohit Minerals Pvt. Ltd., Supreme Court of India, judgment dated 19 May 2022 — ocean-freight IGST struck down; GST Council recommendations held recommendatory and non-binding 4. PIB — GST Revenue Collection data, Ministry of Finance — sustained monthly gross GST collections in the ₹1.9–2 lakh crore range