Customers are entitled to Benefit of Tax Rate Reduction by way of Reduced Prices: NAA [Read Order]

The National Anti-Profiteering Authority ( NAA ) ruled that the customers are entitled to the benefit of the reduced tax rates by the way of reduced prices.

The report submitted by the DGAP allegedly stated that despite the reduction in the rate of Goods and Service Tax (GST) from 18% to 5%, the Respondent had not passed on the commensurate benefit to the consumers since he has increased the base prices of his products.

The Respondent has contended that the DGAP, while calculating the profiteered amount, had not considered the prices of products which had been reduced by him and that the DGAP has considered such impact as zero, ignoring the negative values.

The Respondent relied upon the decision of  National Anti-Profiteering Authority in the case of M/s Flipkart wherein it had been recorded that withdrawal of discounts was the prerogative of the supplier and did amount to profiteering.

The National Anti-Profiteering Authority (NAA) held that the case cited by the respondent was irrelevant and directed the respondent to reduce his prices commensurately in terms of Rule 133 (3) (a) of the Central Goods & Services Tax (CGST) Rules, 2017.

“This Authority as per Rule 136 of the Central Goods & Services Tax (CGST) Rules directs the Commissioner of SGST Maharashtra to monitor this order under the supervision of the DGAP by ensuring that the amount profiteered by the Respondent as ordered by this Authority is deposited in the CWFs of the Central and the Maharashtra State Governments as per the details given above. A report in compliance of this order shall be submitted to this Authority by the concerned SGST Commissioner within a period of 4 months from the date of receipt of this order,” the authority said.