Pre & Post GST Rate – NAA Denies the Charge of ‘Profiteering’ from Somany Ceramics

The National Anti-Profiteering Authority (NAA) recently gave its verdict saying that if the discount rate remains the same pre and post-GST reduction then it is not subject to profiteering.

Here is the case of a reduction in the GST rate on Ceramics Glazed Wall Tiles, Printex Crema from 28% to 18% (valid under Notification dated 14 Nov 2017 by Central Government).

The petitioner Kerala State Level Screening Committee on Anti-Profiteering referred the case to the Standing Committee on Anti-profiteering Get to know about complete guide of the anti-profiteering rules under GST in India. Also, we have attached Indian government provisional orders. Read more, accusing the respondent to have profited on the supply of ‘Ceramics’ Glazed Wall Tiles, Printex Crema. The petitioner said that the respondent did not pass on the benefit of a lower GST rate to the consumer as granted under Notification issued by the Central Government as well as State Government on 14 November 2017. Therefore the respondent is allegedly found profiteering and violating the provisions mentioned under section 171 of the CGST Act 2017.

As proof here the petitioner presented two invoices one created before the GST rate reduction and one after the GST rate reduction Grab the information of revised GST slab rates on consumer products in India, Although the GST council finalized the slab rates like 5%, 12%, 18% and 28% Read more. Paying heed to the previous records and the proofs presented by the petitioner, it was clear that the respondent M/s Somany Ceramics Limited has not increased per M2 price of the product (as it was discounted before the rate decrease). The price remained at Rs. 374.74 before and after-tax rate reduction and therefore it is confirmed that the tax reduction benefit has duly been passed on to the petitioner.

The jury consists of Chairman, B.N. Sharma, and Technical Members, J.C. Chauhan, R. Bhagyadevi, and Amand Shah rested the case saying that ‘if the post discount rate is the same in pre and post GST rate reduction then it cannot be considered as the subject of profiteering’.

Clearly, the allegation is not proven against the respondent (under section 171 of the Central Goods and Service Tax Act 2017). The case filed by the petitioner is considered invalid on the grounds that there is no change in the base price of the product after pre and post GST rate reduction and therefore the same has been dismissed by the observing authority.