GST: Citing COVID-19 pandemic, Delhi HC allows Samsonite to deposit Profiteered Amount within 6 months [Read Order]

GST - Samsonite - Profiteered Amount - Taxscan

The Delhi HC via video conferencing allows Samsonite to deposit the principal profiteered amount of Rs. 21.2 crores (after adjustment of Rs. 3 crores which amount to GST) in 6 equated monthly installments keeping in view the COVID-19 pandemic situation.

The petitioner Samsonite has challenged the constitutional validity of and legality of the National Anti Profiteering Authority as well as Section 171 of the Central Goods and Services Tax Act and Rule 126 of the Central Goods and Services Tax Rules.

The National Anti-Profiteering Authority has charged Samsonite India, makers of American Tourister travel bags, to pay up Rs 25.73 crore for continuing to charge higher goods and services tax (GST) from customers despite tax rate reduction from 28% to 18% in 2017.

Further, NAA asked Samsonite to pay half the amount Rs 12.87 crore to the Central consumer welfare fund and the other half to the consumer welfare funds of the 33 states and union territories and the company was also asked to pay 18 percent interest rate for the period between the amount collected by it from customers and the amount of profiteering deposited.

The Authority ordered Samsonite to pay up within three months, and also reduce the prices of its products in accordance with the reduction in the tax rate.

The travel baggage maker requested for easier terms of payment due to difficulties being faced caused by the pandemic. Travel, tourism, and hospitality sectors have been among the worst hit as lockdowns across the country have forced consumers to stay indoors.

The two-judge bench of Justices Manmohan and Sanjeev Narula said, “in view, the COVID-19 pandemic situation, directs the petitioner to deposit the principal profiteered amount i.e. Rs 21.81 crore (i.e. Rs 25.73 crore minus Rs 3.92 crore) in six equated monthly installments”.

“The interest amount, as well as the penalty proceedings initiated by the respondents, are stayed till further orders,” the bench while listing the matter on 24th August 2020 along with other connected matters said.

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