Nirma Ltd Cleared of Profiteering Charges: GSTAT confirms No Contravention of S. 171(1) GST Act, Accepts Report of DGAP [Read Order]
The GSTAT observed that the DGAP’s findings were consistent and well-supported across all stages of inquiry. The Tribunal held that the DGAP’s final report deserved to be accepted and confirmed that Nirma Ltd had not failed to pass on any benefit of tax rate reduction to consumers
Nirma Ltd
Nirma Ltd
The GST Appellate Tribunal ( GSTAT ), Principal Bench, New Delhi, has upheld the findings of the Directorate General of Anti-Profiteering ( DGAP ), confirming that Nirma Ltd did not violate the provisions of Section 171(1) of the Goods and Services Tax ( GST ) Act, 2017 relating to profiteering.
The case started from a letter dated 18 April 2019 issued by the Secretary of the National Anti-Profiteering Authority (NAA), which referred the matter to the DGAP for a detailed probe into allegations that Nirma Ltd had failed to pass on the benefit of GST rate reduction to consumers as mandated under Notification No. 41/2017 dated 14 November 2017.
The DGAP initially conducted a detailed investigation and, in its report dated 15 December 2021, concluded that no profiteering had occurred and that the company had complied with Section 171(1) of the GST Act.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
However, the NAA, in its order dated 10 May 2022, remitted the matter back to the DGAP for further investigation on several specific issues, including whether the company had appropriately reduced MRPs of impacted SKUs, affixed revised price stickers on existing stocks, charged GST at the reduced rate of 18%, and justified any base price increases in November 2017.
Following this direction, the DGAP submitted a second report on 27 January 2023, confirming its earlier conclusion that Nirma Ltd had not violated any anti-profiteering provisions.
Subsequently, the case was transferred to the Competition Commission of India (CCI) after the dissolution of NAA.
The CCI, through its order dated 23 August 2024, instructed the DGAP to conduct a fresh re-investigation in accordance with the Delhi High Court’s judgment in W.P. (C) No. 7743/2019 dated 29 January 2024.
After thorough re-investigation, the DGAP once again concluded in its report dated 23 May 2025, that no contravention of Section 171(1) had occurred, clearing Nirma Ltd of profiteering allegations for the third time.
Justice (Retd.) Mayank Kumar Jain observed that the DGAP’s findings were consistent and well-supported across all stages of inquiry. The Tribunal held that the DGAP’s final report deserved to be accepted and confirmed that Nirma Ltd had not failed to pass on any benefit of tax rate reduction to consumers.
The appellate tribunal accepted the DGAP’s report dated 23 May 2025 and ordered the closure of the case.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
