Passing of the Constitution (One Hundred and Twenty-Second Amendment) Bill, 2014 (“the Bill”) by the Lower House of the Parliament is a big milestone in the process of implementation of Goods and Services Tax (“GST”). Given the different political equation in the Rajya Sabha, it is interesting to examine various possibilities in the light of provisions contained in the Constitution of India (“the Constitution”) for enactment of the Bill.

Since amendment of the Constitution concerning taxing powers is a serious matter, Article 368 of the Constitution mandates that such amendment can only be passed if it is approved by:

• a majority of the total members of the House; and
• at least by 2/3^rd majority of the members who are present and vote.

Further, as per Article 108 of the Constitution of India, joint sitting of both the Houses cannot be called in such cases.  Thus, the Bill needs to be tabled separately before each of the Houses of the Parliament.

Given that the incumbent National Democratic Alliance (“NDA”) has 338 members out of the total strength of 542 members in the Lok Sabha, the Bill got passed in the House without much hassle. However, the members of the Indian National Congress (“Congress”) walked out of the House during the voting whereas AIADMK members voted against the Bill.

All eyes are now set on the Rajya Sabha, which has total strength of 245 members (comprising of 234 elected, 10 nominated and 1 vacant seat) including 68 and 11 members from Congress and AIADMK respectively.  Thus, the Bill can be passed if it is approved by, (a) at least 123 members; and (b) 2/3rd members present and voting.

To put the above numbers in perspective, let us look at the following scenarios:

Scenario A:

Where 79 members (i.e. 68 Congress members and 11 AIADMK members) vote against the Bill

• The Bill could only be passed if at least 158 other members vote in favour of the Bill (to achieve 2/3^rd majority against 79 dissenting voters)
• It means that out of 244 members, at least 237 (158+79) should vote.
• This means that if 8 or more non-Congress/ non-AIADMK members are absent or walkout or abstain from voting or vote against the Bill, the amendment would not be passed (since it will impair the 2/3^rd ratio)
• Thus, if any one of the following non-NDA parties decide to change the stand taken by them in the Lok Sabha, the Bill cannot be passed:

1. Samajwadi Party: 15 members
2. Janta Dal (United): 12 members
3. Trinmool Congress: 12 members
4. Bahujan Samaj Party: 10 members
5. Communist Party of India (Marxist): 9 members

Thus, in this scenario, the regional/ small parties will play a very critical role and if any of them dissent, NDA will need to hold the Bill till it gets better numbers in the House.

Scenario B:

Where 68 Congress members walkout of the House but 11 AIADMK members vote against the Bill (i.e. following the stand taken by them in the Lok Sabha)

• There will be 176 voting members (i.e. 244 members minus 68 Congress members) out of which 118 members (2/3^rd of 176) would need to approve the Bill
• However, the Bill will still need the approval of 123 members (being majority of the total strength of the House)
• In this scenario even if 53 members do not approve the Bill, the same will still be cleared.
• This will serve as cushion against small regional parties if they decide to back-out.

Thus, a walkout by the Congress members will help NDA in getting the Bill approved.  Further, in that scenario the role of small/ regional parties will also get diluted.

Scenario C:

Where 68 Congress members vote against the Bill but 11 AIADMK members walk out

• At least 136 members will need to vote in favour (to achieve 2/3^rd majority against 68 dissenting Congress members)
• It means that out of 244 members, at least 204 (136+68) should vote.
• Thus, in addition to 11 AIADMK members even if 29 more members walk out, NDA government will still be able to get the Bill passed at the Upper House.
• The situation will be different, if any of the regional/ small party decide to vote against the Bill, as in that event the incumbent party will not be able to garner the 2/3^rd number

From the above arithmetic, it is apparent that the bill can be halted in the Rajya Sabha only if the Congress plus any one or more regional/ small parties (i.e., AIADMK, CPI(M), JD, BSP, TC) decide to vote against the Bill. 

A simple walkout, absence, non-voting by the Congress members will not cause the GST bandwagon to stop in the Upper House.

In case one or more key opposition parties and Congress decide to vote against the Bill, the NDA government may refer the Bill to the Parliamentary Committee.  This will help the Government to buy more time.  In that event, the Government will bring the Bill back for voting when they get better number in the Rajya Sabha basis their winning in Rajasthan, Haryana and other State elections.

However, waiting for the appointment of NDA members against the vacancy caused by retirement of opposition members could delay the enactment of Bill and the Government may miss the April 1, 2016 deadline.

Nevertheless, it is more or less certain that the Rajya Sabha will pass the Bill for amendment of the Constitution sooner or later, which will be seen as a great step in the process of implementing the big-bang reform.