The National Anti-Profiteering Authority (NAA) directed the Directorate General of Anti-Profiteering to reinvestigate and recompute the quantum of profiteering against Devi Cinema.
The Applicants, Principal Commissioner and DGAP alleged profiteering by the Respondent, Devi Cinema in respect of the supply of services by way of admission to an exhibition of cinematograph films where the price of admission ticket was one hundred rupees or less despite the reduction in the rate of GST from 18% to 12% with effect from January 1, 2019.
The price of two categories i.e. the First and the Second class movie tickets has been reduced commensurately by the Respondent with effect from March 11, 2019. Since he has complied with the provisions of Section 171 of the CGST Act, 2017, the period from March 11, 2019 has no relevance from the perspective of Section 171 of the CGST Act, 2017, and hence, no profiteering can be established for the period after March 11, 2019.
The Authority noted that since the Respondent has increased the price of the movie tíckets of the First and the Second class categories only in the month of May 2019, this price increase cannot be correlated to provisions of Section 171 of the CGST Act, 2017.
The DGAP has reported that in the post-tax-rate reduction period, the Respondent has maintained the same base prices in respect of the Upper and Lower Balcony categories of movie tickets
The three-member bench headed by the Chairman, B.N. Sharma observed that there is no profiteering in the Upper and Lower Balcony categories of movie tickets. Therefore, though profiteering has been established against the Respondent in the categories of First class and Second class movie tickets, the computation of profiteering merits to be limited only up to 10.03.2019 as the Respondent had reduced the base prices commensurately for the First class and Second class movie tickets after March 11, 2019.
The NAA held that no profiteering can arise for the period after March 11, 2019.
Therefore, the NAA directed the DGAP to recompute the quantum of profiteering and submit the report under Section 129 (6) of the CGST Rules, 2017.Subscribe Taxscan AdFree to view the Judgment