DG Safeguards Sent 53 Anti Profiteering Notices to Businesses Under GST

The Directorate General of Safeguards has started an investigation and notified as well in 53 cases, as mentioned by the parliament. The DG of Safeguards looks into the complaints under Goods and Services Tax. According to Shiv Pratap Shukla, Minister of State for Finance, the anti-profiteering authority body had collected approximately 2,732 refund claims on February 23 and distributed Rs 3,296.59 crore.

When Rajya Sabha asked Minister of State for Finance about the complaints, he replied in a written note that till February 23, the Anti-profiteering authority accepted 354 complaints claiming that many consumers didn’t receive the benefits of input tax credit or reduction in tax rate. From total 354 applications, 65 has been sent to DG Safeguards to look into for further information. He said, “Notices of initiation of investigation have been issued by the Directorate General of Safeguards in respect of 53 applications.”

The standing committee has forwarded again 68 applications for not being the relevant issue to anti-profiteering applications to the jurisdictional GST authorities and further 59 relevant applications to state-level screening committees for investigation further. In November, the government has established the National Anti-Profiteering Authority to ascertain end users receive the benefits of price cut under the new indirect tax regime. According to anti-profiteering mechanism mentioned under GST regime, local complaints will be first reached to the state-level screening committee, whereas the complaints in nature of national level will be forwarded to the Standing Committee.

If the forwarded complaints are liable for further consideration, the relevant committees will forward those complaints to the Directorate General of Safeguards (DGS) for further investigation.

The DGS will take around three months to consider the application and after investigation, the report will be generated and forwarded to the anti-profiteering authority. If the anti-profiteering authority finds the company guilty for not passing the GST price cut benefits to consumers, it can ask company to directly transfer the benefits to consumer or if the beneficiary is not identified, the company has to transfer the funds to the ‘consumer welfare fund’ in a time period mentioned by the authority.

The Authority is powerful in terms of cancelling the registration of any business or entity if it is not passing the benefits to the consumers under GST regime. But, the cancellation of registration will be the last step by the authority to combat the violation. As per the anti-profiteering provisions, the Anti-profiteering authority will advise the entity about the return of the unpaid benefits gained from price cut under GST provisions and 18% interest as well on that penalty.