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Yesterday, the government circulated certain official amendments to the Constitution (122nd Amendment) Bill, 2014 on GST. The Bill is currently pending in Rajya Sabha. The Bill was introduced and passed in Lok Sabha in May 2015. It was then referred to a Select Committee of Rajya Sabha which submitted its report in July 2015. With the Bill listed for passage this week, we explain key provisions in the Bill, and the amendments proposed. What is the GST? Currently, indirect taxes are imposed on goods and services. These include excise duty, sales tax, service tax, octroi, customs duty etc. Some of these taxes are levied by the centre and some by the states. For taxes imposed by states, the tax rates may vary across different states. Also, goods and services are taxed differently. The Goods and Services Tax (GST) is a value added tax levied across goods and services at the point of consumption. The idea of a GST regime is to subsume most indirect taxes under a single taxation regime. This is expected to help broaden the tax base, increase tax compliance, and reduce economic distortions caused by inter-state variations in taxes. What does the 2014 Bill on GST do? The 2014 Bill amends the Constitution to give concurrent powers to Parliament and state legislatures to levy a Goods and Services tax (GST). This implies that the centre will levy a central GST (CGST), while states will be permitted to levy a state GST (SGST). For goods and services that pass through several states, or imports, the centre will levy another tax, the Integrated GST (IGST). Alcohol for human consumption has been kept out of the purview of GST. Further, GST will be levied on 5 types of petroleum products at a later date, to be decided by the GST Council. The Council is a body comprising of Finance Ministers of the centre and all states (including Delhi and Puducherry). This body will make recommendations in relation to the implementation of GST, including the rates, principles of levy, etc. The Council is also to decide the modalities for resolution of disputes that arise out of its recommendations. States may be given compensation for any revenue losses they may face from the introduction of the GST regime. Such compensation may be provided for a period of up to five years. Further, the centre may levy an additional tax, up to 1%, in the course of interstate trade. The revenues from the levy of this tax will be given to the state from where the good originates. Expert bodies like the Select Committee and the Arvind Subramanian Committee have observed that this provision could lead to cascading of taxes (as tax on tax will be levied).[i] It also distorts the creation of a national market, as a product made in one state and sold in another would be more expensive than one made and sold within the same state. What are the key changes proposed by the 2016 amendments? The amendments propose three key changes to the 2014 Bill. They relate to (i) additional tax up to 1%; (ii) compensation to states; and (iii) dispute resolution by the GST Council.
These amendments will be taken up for discussion with the Bill in Rajya Sabha this week. The Bill requires a special majority for its passage as it is a Constitution Amendment Bill (that is at least 50% majority of the total membership in the House, and 2/3rds majority of all members present and voting). If the Bill is passed with amendments, it will have to be sent back to Lok Sabha for consideration and passage. After its passage in Parliament, at least 50% state legislatures will have to pass resolutions to ratify the Bill. Once the constitutional framework is in place, the centre will have to pass simple laws to levy CGST and IGST. Similarly, all states will have to pass a simple law on SGST. These laws will specify the rates of the GST to be levied, the goods and services that will be included, the threshold of the turnover of businesses to be included, etc. Note that the Arvind Subramanian Committee, set up by the Finance Ministry, recommended the rates of GST that may be levied. The table below details the bands of rates proposed.
| Table 1: Rates of GST recommended by Expert Committee headed by Arvind Subramanian | ||
| Type of rate | Rate | Details |
| Revenue Neutral Rate | 15% | Single rate which maintains revenue at current levels. |
| Standard Rate | 17-18% | Too be applied to most goods and services |
| Lower rates | 12% | To be applied to certain goods consumed by the poor |
| Demerit rate | 40% | To be applied on luxury cars, aerated beverages, paan masala, and tobacco |
| Source: Arvind Subramanian Committee Report (2015) | ||
Several other measures related to the back end infrastructure for registration and reporting of GST, administrative officials related to GST, etc. will also have to be put in place, before GST can be rolled out. [For further details on the full list of amendments, please see here. For other details on the GST Bill, please see here.]
This blog has been updated on Jan 19, 2021 to also cover the Madhya Pradesh Ordinance which was promulgated earlier in the month. The comparison table has also been revised accordingly.
On November 27, 2020, the Uttar Pradesh (UP) Prohibition of Unlawful Conversion of Religion Ordinance, 2020 was promulgated by the state government. This was followed by the Madhya Pradesh (MP) government promulgating the Madhya Pradesh Freedom of Religion Ordinance, 2020, in January 2021. These Ordinances seek to regulate religious conversions and prohibit certain types of religious conversions (including through marriages). The MP Ordinance replaces the MP Dharma Swatantra Adhiniyam, 1968, which previously regulated religious conversions in the state. Few other states, including Haryana and Karnataka, are also planning to introduce a similar law. This blog post looks at existing anti-conversion laws in the country and compares the latest UP and MP Ordinances with these laws.
Anti-conversion laws in India
The Constitution guarantees the freedom to profess, propagate, and practise religion, and allows all religious sections to manage their own affairs in matters of religion; subject to public order, morality, and health. To date, there has been no central legislation restricting or regulating religious conversions. Further, in 2015, the Union Law Ministry stated that Parliament does not have the legislative competence to pass anti-conversion legislation. However, it is to be noted that, since 1954, on multiple occasions, Private Member Bills have been introduced in (but never approved by) the Parliament, to regulate religious conversions.
Over the years, several states have enacted ‘Freedom of Religion’ legislation to restrict religious conversions carried out by force, fraud, or inducements. These are: (i) Odisha (1967), (ii) Madhya Pradesh (1968), (iii) Arunachal Pradesh (1978), (iv) Chhattisgarh (2000 and 2006), (v) Gujarat (2003), (vi) Himachal Pradesh (2006 and 2019), (vii) Jharkhand (2017), and (viii) Uttarakhand (2018). Additionally, the Himachal Pradesh (2019) and Uttarakhand legislations also declare a marriage to be void if it was done for the sole purpose of unlawful conversion, or vice-versa. Further, the states of Tamil Nadu (2002) and Rajasthan (2006 and 2008) had also passed similar legislation. However, the Tamil Nadu legislation was repealed in 2006 (after protests by Christian minorities), while in case of Rajasthan, the bills did not receive the Governor’s and President’s assent respectively. Please see Table 2 for a comparison of anti-conversion laws across the country.
In November 2019, citing rising incidents of forced/fraudulent religious conversions, the Uttar Pradesh Law Commission recommended enacting a new law to regulate religious conversions. This led the state government to promulgate the recent Ordinance in 2020. Following UP, the MP government also decided to promulgate an Ordinance in January 2021 to regulate religious conversions. We discuss key features of these ordinances below.
What do the UP and MP Ordinances do?
The MP and UP Ordinances define conversion as renouncing one’s existing religion and adopting another religion. However, both Ordinances exclude re-conversion to immediate previous religion (in UP), and parental religion (in MP) from this definition. Parental religion is the religion to which the individual’s father belonged to, at the time of the individual’s birth. These Ordinances prescribe the procedure for individuals seeking to undergo conversions (in the states of UP and MP) and declare all other forms of conversion (that violate the prescribed procedures) illegal.
Procedure for conversion: Both the Ordinances require: (i) persons wishing to convert to a different religion, and (ii) persons supervising the conversion (religious convertors in UP, and religious priests or persons organising a conversion in MP) to submit an advance declaration of the proposed religious conversion to the District Magistrate (DM). In both states, the individuals seeking to undergo conversion are required to give advance notice of 60 days to the DM. However, in UP, the religious convertors are required to notify one month in advance, whereas in MP, the priests or organisers are also required to notify 60 days in advance. Upon receiving the declarations, the DMs in UP are further required to conduct a police enquiry into the intention, purpose, and cause of the proposed conversion. No such requirement exists in the MP Ordinance, although it mandates the DM’s sanction as a prerequisite for any court to take cognisance of an offence caused by violation of these procedures.
The UP Ordinance also lays down a post-conversion procedure. Post-conversion, within 60 days from the date of conversion, the converted individual is required to submit a declaration (with various personal details) to the DM. The DM will publicly exhibit a copy of the declaration (till the conversion is confirmed) and record any objections to the conversion. The converted individual must then appear before the DM to establish his/her identity, within 21 days of sending the declaration, and confirm the contents of the declaration.
Both the Ordinances also prescribe varying punishments for violation of any procedure prescribed by them, as specified in Table 2.
Prohibition on conversions: Both, the UP and MP Ordinances prohibit conversion of religion through means, such as: (i) force, misrepresentation, undue influence, and allurement, or (ii) fraud, or (iii) marriage. They also prohibit a person from abetting, convincing, and conspiring to such conversions. Further, the Ordinances assign the burden of proof of the lawfulness of religious conversion to: (i) the persons causing or facilitating such conversions, in UP, and (ii) the person accused of causing unlawful conversion, in MP.
Complaints against unlawful conversions: Both Ordinances allow for police complaints, against unlawful religious conversions, to be registered by: (i) the victim of such conversion, (ii) his/her parents or siblings, or (iii) any other person related to them by blood, and marriage or adoption. The MP Ordinance additionally permits persons related by guardianship or custodianship to also register a complaint, provided they take the leave of the court. Further, the MP Ordinance assigns the power to investigate such complaints to police officers of the rank of Sub-Inspector and above.
Marriages involving religious conversion: As per the UP Ordinance, a marriage is liable to be declared null and void, if: (i) it was done for the sole purpose of unlawful conversion, or vice-versa, and (ii) the religious conversion was not done as per the procedure specified in the Ordinance. Similarly, the MP Ordinance declares a marriage null and void, if: (i) it was done with an intent to convert a person, and (ii) the conversion took place through any of the prohibited means specified under the Ordinance. Further, the MP Ordinance explicitly provides for punishment (as specified in Table 2) for the concealment of religion for the purpose of marriage.
Right to inheritance and maintenance: The MP Ordinance additionally provides certain safeguards for women and children. It considers children born out of a marriage involving unlawful religious conversion as legitimate and provides for them to have the right to property of only the father (as per the law governing the inheritance of the father). Further, the Ordinance provides for maintenance to be given to: (i) a woman whose marriage is deemed unlawful under the Ordinance, and (ii) her children born out of such a marriage.
Punishment for unlawful conversions: Both the MP and UP Ordinances provide for punishment for causing or facilitating unlawful religious conversion, as specified in Table 1. Also, all offences under both Ordinances are cognisable and non-bailable.
Additionally, under the UP Ordinance, the accused will be liable to pay compensation of up to five lakh rupees to the victim of conversion and repeat offences will attract double the punishment specified for the respective offence. However, under the MP Ordinance, each repeat offence will attract punishment of a fine, and imprisonment between five and 10 years. Further, it provides for the Session Court to try an accused person, at the same trial, for: (i) an offence under this Ordinance, and (ii) also for other offences he has been charged with, under the Criminal Procedure Code, 1973.
Table 1: Punishments prescribed under the UP and MP Ordinances for offences by individuals for causing/facilitating the conversion
|
Punishment |
Uttar Pradesh |
Madhya Pradesh |
|
Mass conversion (conversion of two or more persons at the same time) |
||
|
Term of imprisonment |
3-10 years |
5-10 years |
|
Fine Amount |
Rs 50,000 or more |
Rs 1,00,000 or more |
|
Conversion of a minor, woman, or person belonging to SC or ST |
||
|
Term of imprisonment |
2-10 years |
2-10 years |
|
Fine Amount |
Rs 25,000 or more |
Rs 50,000 or more |
|
Any other conversion |
||
|
Term of imprisonment |
1-5 years |
1-5 years |
|
Fine Amount |
Rs 15,000 or more |
Rs 25,000 or more |
If any of the above three offences are committed by an organisation, under the UP Ordinance, the registration of the organisation is liable to be cancelled and grants or financial aid from the state government is liable to be discontinued. Under the MP Ordinance, only the registration of such organisations is liable to be cancelled.
* - It is not clear if the Chhattisgarh Law is currently in force or not.
** - Madhya Pradesh originally enacted a law in 1968. And has now replaced it with an Ordinance in 2021.
Note: For Odisha, Jharkhand, and Uttarakhand, some of the penalties have been specified in the Rules published under their respective Acts. For the rest of the states, the penalties have been specified in the respective Acts itself.
