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How parliament can enact or repeal any law it pleases, in spite of 'basic structure'? answer given is D

Read the last line -- "a State where Parliament is sovereign".

Indian Parliament is NOT sovereign. India has constitutional sovereignty
The 'Constituent Assembly' for example was a sovereign body. 
Another example of a sovereign Parliament is the British Parliament. 


Hence, if a Parliament is sovereign then by definition of 'sovereignty, it can do as it pleases.

Googling the word 'sovereign' tells you that it means "having the highest possible authority". 
Thus, in such a case, the Parliament would be above Judiciary, above laws, above everything.

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