KL Report


The Government of India in its revised draft of the Constitution (One Hundred Fifteenth Amendment) Bill 2011, has proposed insertion of a new sub-clause in clause-IV of Article 279A to provide for special provisions with respect to the States of Jammu and Kashmir and other North Eastern States of India.

It was stated at the meeting of Empowered Committee (EC) of State Finance Ministers held Thursday in New Delhi under the Chairmanship of Jammu and Kashmir Finance Minister, Abdul Rahim Rather, who is also Chairman of the Empowered Committee.

In the daylong meeting, among other things, the revised draft of Constitution (One Hundred and Fifteenth Amendment) Bill 2011 for GST, was discussed inconclusively.

The recommendations regarding Constitution Amendment Bill made by the Empowered Committee some time back as also the recommendations made by Parliamentary Standing Committee on Finances also came under discussion. A Sub-Committee was constituted to look into all these sets of recommendations and asked to report well before the next meeting of the Empowered Committee.

The 14th Finance Commission has sought information on impact of VAT Law on the revenue of the States, compensation offered and paid by Government of India on this account, CST rate, the claims made by various States for compensation on this account and settlement of the claims and the arrears payable by Government of India. It is pertinent to note that the ‘impact of proposed GST on the revenues of the Centre and the States, mechanism for payment of compensation in case of revenue loss’ has been included as one of the Terms of Reference of the 14th Finance Commission. The Commission has asked for relevant information in this regard also. Detailed notes prepared by the Empowered Committee on the subject were also discussed by the Empowered Committee and States were told to offer their comments within 7 days so that a comprehensive response is prepared for use by the 14th Finance Commission.

The revenue position of the States for the current year upto end of July was reviewed. It was noted with concern that some of the States were lagging behind the target fixed in this regard. These States were impressed upon to make all out efforts to achieve the targets fixed by the government and various forums in this regard.

Some issues related to the project of tinxsys were also discussed and finally resolved.

An Empowered Group on IT Infrastructure of GST under the Chairmanship of Dr. Nandan Nilekani (Chairman UIBAI) was constituted in 2010. The Empowered Group played extremely important role. It’s term expired last month. However, it has been able to achieve only half of the goals assigned to it. Certain policy decisions are yet to be taken. It was therefore felt that it should continue for some time more. The Empowered Committee approved the extension of the term of the Empowered Group.

The Government of Meghalaya, requested that the next meeting of Empowered Committee should be held in one of the North Eastern States preferably Meghalaya. It was accordingly decided that the next meeting of the Empowered Committee will be held at Shilong in Meghalaya in the month of November this year.


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