The Competition Commission of India is going to crack down the companies which are profiteering by holding the Goods and Services Tax (GST).
Once the authority is fully operational, more than a hundred orders will be issued against businesses that allegedly profited by deducting consumers’ GST benefits as per the reports.
Further, orders on profiteering will begin to be issued once at least one new member or the chairperson has been appointed, which will give CCI the necessary quorum of three members to decide cases. The government is currently in the process of appointing a new chairperson for the antitrust regulator and three other members.
The agency looking into GST-related profiteering, the Directorate General of Anti-Profiteering (DGAP), has finished well over 100 investigation reports on corporate profiteering, and final instructions from CCI are still pending.
According to sources, the majority of these cases involve alleged profiteering by cement manufacturers, FMCG manufacturers, and real estate developers.
For allegedly neglecting to pass on to clients the benefits of the tax credits paid on raw materials like cement and steel, which became available to developers under the GST regime to pay off their final tax bill, real estate developers in particular are the subject of regulatory scrutiny.
In order to prevent corporate deals from being impacted by the regulator’s lack of quorum—which is now only present with two members—the government recently permitted CCI to approve mergers and acquisitions with its current strength. This concession does not, however, apply to cases involving profiteering or anti-competitive practices
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