2020-TIOL-GST-346, Dated: Thursday, June 11, 2020

GST - Petitioner inter alia seeks quashing the proceedings pursuant to the search and seizure operation carried out at the warehouse of the petitioner no. 1 at Chandausi and at Barabanki; release of documents, assets and other materials etc. - Advocate General cites the apex court decision in Kay Pan Fragrance Pvt. Ltd - 2019-TIOL-517-SC-GST and submits that the Central Goods and Services Tax Act, 2017 provides a complete procedure for release of such goods, as contained in Section 67 of the Act read with Rule 141 of the relevant Rules; that the petitioners should have approached the appropriate authority under Uttar Pradesh Goods and Services Tax Act, 2017 to ventilate their grievance - Petitioners further submit that "Mentha Oil" has been seized in the matter which is perishable in nature but the authority concerned has not yet exercised its power under Section 67 of the Act - Revenue counsel informed that "Mentha Oil" is not perishable in nature and it has not been included in the schedule contained in the Notification dated 13th June, 2018 issued by Government of India.

Held: Without expressing any opinion on the merits of the case, this writ petition is finally disposed of with a direction to the petitioners to make an appropriate application/representation before the authority concerned under the relevant provision of the Act, 2017 ventilating their grievances and if any such application/representation is filed, the authority concerned shall make all endeavour to consider and decide the same by a reasoned and speaking order, after affording opportunity of personal hearing to the petitioners, in accordance with law expeditiously, preferably within two weeks from the date of receipt of the said application: High Court [para 9]

GST - Petitioner has challenged the order passed by respondent no. 3 u/s 129(3) of the CGST Act - It is not disputed that the impugned order is appealable under Section 112 and is to be filed within 90 days from the date on which the order sought to be appealed is communicated to the person preferring the appeal; that instant petition has been filed bypassing the remedy of appeal under Section 112 of the Act on the ground that the appellate tribunal has not been constituted till date - Revenue counsel points out that having regard to the difficulty faced by the assessees in filing appeal on account of non-constitution of the Tribunal and its Benches in various States and Union Territories, Central government has issued Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019 notified in the Gazette of India dated 3rd December, 2019 stipulating that in such a situation, the three months' period shall be considered to be the date on which the President or the State President, as the case may be, of the Appellate Tribunal after its constitution under Section 109, enters office - Therefore, it is urged that in such circumstances, the petitioner can wait and avail the remedy of filing appeal as and when the Tribunal is constituted - It is also pointed out that since the seized goods have already been released, therefore, no prejudice is going to be caused to the petitioner at the present moment - Counsel for the petitioner fairly admits the above legal position and also the fact that the goods have already been released.

Held: Instant petition is, therefore, disposed of by providing that the petitioner can invoke the remedy of filing appeal before the Tribunal in terms of the provisions of the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019: High Court

Whether since there are several contradictions in case put forward by the assessee before the Settlement Commission which remain unanswered and therefore the case ought not have been settlement before answering those questions - YES : HC

GST - Wrong availment of Input Tax Credit and passing the same to the buyer - Application is filed under Section 439 of the Code of Criminal Procedure, 1973, for regular bail in connection with offence registered in the context of s.132(1)(b) of the CGST Act, 2017.

Held: Court is of the opinion that this is a fit case to exercise the discretion and enlarge the applicant on regular bail - Court has arrived at such conclusion by considering the following aspects viz. applicant is in jail since 23.12.2019; for the alleged transaction of wrong availment of ITC and further passing of the same, it is always open for the respondent department to take departmental action for recovery of penalty against the applicant; that without prejudice to his rights and contentions, applicant is ready and willing to deposit Rs.25 lakh before the respondent No.2 within a period of 8 weeks from the date of his actual release; that applicant will cooperate with the respondent department during the course of further investigation - applicant is ordered to be released on regular bail on executing a personal bond of Rs.10,000/- with one surety of like amount to the satisfaction of the trial Court and subject to the compliance of the conditions set out: High Court (para 6 to 8)

- Application allowed : GUJARAT HIGH COURT

2020-TIOL-993-HC-P&H-GST

IGST - Officers of DRI conducted a search on 9.7.2019 in the factory premises of the petitioner - The search was in connection with investigation going on for availing ineligible drawback and IGST by way of accumulating ITC by procuring fake purchase bills by M/s Worldwide Tradelinks, Ludhiana and M/s NMR Knitfab Private Limited, Ludhiana - The petitioner had supplied material to said dealers - Records were seized and panchanama was prepared - Petitioner contends that panchnama should be quashed as officials of DRI had no jurisdiction to conduct search at the premises of the petitioner as he is not an exporter - The argument is that investigation is with regard to Ludhiana dealer and in case of any doubt or dispute, it was only the officials of GST Department who could have proceeded further in the matter insofar as the petitioner is concerned.

Held: Section 105 of the Customs Act is widely worded and search can be conducted if the Assistant or Deputy Commissioner of Customs has reasons to believe that there are any document or things, which in his opinion, will be useful or relevant to any proceedings under this Act or secreted at any place - The section does not restrict the search only with regard to importer or exporter, the other premises can also be searched - The petitioner was a supplier/seller to the exporters at Ludhiana, there was an investigation that ineligible drawback etc. had been claimed by procuring only the bills without there being transfer of goods, this establishes the relevance of search with proceedings under the Act - contention of petitioner that there is a mistake in panchnama in recording the contents and same may be rectified is a disputed question of fact and said aspect cannot be gone into at this stage and would not be a reason to quash the panchnama or to declare the search illegal - The issue of evidentiary value of the contents can be raised by the petitioner at the appropriate stage - Writ petition is dismissed: High Court

-Petition dismissed : PUNJAB AND HARYANA HIGH COURT

GST - Present writ petition has been filed by the petitioner challenging the provisional attachment order dated 05th March, 2020 issued by respondent No.1 to the petitioner's bankers - Petitioner states that in the absence of any notice issued under Section 74 of the CGST Act, 2017, no order of attachment under Section 83 of the Act, 2017 could have been passed by the respondents.

Held: Court is of the view that Rule 159(5) of the Central Goods and Services Tax Rules, 2017 is squarely applicable to the facts of the present case - A Division Bench of High Court of Gujarat in Pranit Hem Desai - 2019-TIOL-831-HC-AHM-GST has held that the petition cannot be entertained in the light of the availability of the efficacious alternative remedy under sub-rule (5) of rule 159 of the Central Goods and Services Tax Rules, 2017 - Keeping in view the similarity of circumstances as obtained in the above case, Bench deems it appropriate to direct the respondent No.1 to treat the present writ petition as an objection under Rule 159(5) of the Central Goods and Services Tax Rules, 2017 and decide the same within three working days - With the aforesaid direction, present writ petition is disposed of: High Court [para 7 to 10]

GST - Petitioner has sought regular bail for offences allegedly committed under s.132 of the CGST Act, 2017 - Petitioner submits that he is in custody since 03.08.2018 and the maximum period of sentence that can be awarded is five years - Respondent, while opposing the petition brings to the notice of the court that the bail petition filed by similarly situated co-accused Sandeep Goyal was dismissed by this Court on 05.02.2020 and in appeal, the apex court too has (vide order dated 17.04.2020) not granted bail to the co-accused but directed the department to complete the investigations within a period of three months and if investigation is not completed, to release the said petitioner on bail by the trial court by imposing appropriate terms and conditions.

Held: Keeping in view the above order dated 17.04.2020, it is ordered that in case investigation is not completed in terms of aforesaid order passed by the Supreme Court, i.e., within three months from 17.04.2020, petitioner be released on bail by the trial court, subject to its satisfaction - It is further ordered that in case investigation is completed within three months, it would be open for the petitioner to move the trial court for bail - Petition disposed of: High Court [para 5, 6]

GST - Applicant offers three types of test-administrative solutions on behalf of its clients to the test-takers/candidates in India - Type 1 tests are self-administered by the candidates and are wholly digital in India - Test-taker uses an internet browser for the entire process ranging from creating a personal profile, selecting the desired test, remitting payment, taking the test, scoring and viewing test results - tests are not required to be taken from the test centres and can be taken from any location as desired by the candidate - scores are provided by the electronic software based on a computer-based algorithm in its entirety and the test-taker gets the results in an electronic format immediately on completion of the test - inasmuch as the entire test experience is electronic without any human intervention - insofar as Type 2 test is concerned, major difference with Type 1 test is that on the day of the test, the candidate is required to go to the test centre, where an administrator will verify the identity of the candidate, validate test registration and appointment of the candidate and who will thereafter assign a computer to the candidate to take a test - during the test-taking process, the candidate is continuously monitored by the invigilator - once the candidate has completed the test, the scores are provided by a computer-based algorithm on the electronic software and the test-taker gets the result immediately on completion of the test at the test centre itself - entire process is recorded by cameras as a video and such recording is reviewed by a test security official to validate any testing issues that may have arisen during the test administration - in the Type 3 test, there is a mixture of multiple choice questions and analytical writing assessment section i.e. essay-based questions - test-taker is able to see the score for MCQ and an indicative score (which is not final) for essay based questions marked by the computer-based algorithm - however, essay based questions are sent to a human-evaluator in USA for assessment and final scoring - once the entire scoring activity is completed, the test-taker is then e-mailed a URL to access their official score typically within a week's time - Applicant has sought advance ruling on the following viz. whether the Type 2 test classifies as OIDAR service; if Type 2 test does not qualify as OIDAR, whether applicant is liable to pay Integrated Tax; whether Type 3 test is classifiable as OIDAR and, if not, whether applicant is liable to pay Integrated Tax.

Held: Provision of taking tests online at designated test centres are naturally bundled activities and are supplied in conjunction with each other in the ordinary course of business and, therefore, can be termed as Composite supply as per Section 2(30) of the Act, 2017 - since the main object of the whole activity is to take online tests, so the principal supply would be OIDAR service provided by applicant to non-taxable online recipients - Type 2 test, therefore, qualifies for classification as OIDAR services; however, Type 3 test does not classify as OIDAR services since Type 3 tests requires more than minimal human intervention in order to complete the provision of the service, however, IGST is exempted by virtue of Sl. no. 10 of 9/2017-ITR: AAR

GST - Product ‘Whole Wheat Parota, Malabar Parota' is neither khakhra, plain chapatti or roti - Impugned products are not ready to eat food preparations like khakhra, plain chapatti or roti but require further processing for human consumption as admitted by applicant - Therefore, impugned products are classifiable under Chapter Heading 2106, not CH 1905 as claimed and is not covered under Entry no. 99A of Schedule I to 1/2017-CTR which entry attracts GST @5%: AAR

GST - Applicant is dealing in services which are in the nature of storage and warehousing of agricultural produce, food grains including pulses and rice etc. - they are renting or leasing of agro machinery or vacant land with or without structure incidental to its use in relation to agricultural produce and they are using leased premises for storage of agricultural produce which is exempted from GST and lessor is insisting to pay GST on lease charges and the lessee has denied to pay GST on lease charges where the lessee is using the premises for storage of agricultural produce only - applicant, therefore, seeks to know the tax implications in respect of the aforementioned activities.

Held: Above supply is taxable @18% except that the same is exempted if the supply of service is for storage or warehousing of ‘agriculture produce' as defined in clause 2(d) of 12/2017-CTR: AAR

GST - Applicant is manufacturer of cement having two cement plants in Telangana - They occasionally made inter-state sale of cement on ex-factory/works basis from their plants in Telangana - when they make ex-factory sales from their plant, delivery terminates at their factory gate itself but the further movement is carried by recipient or transporter of goods up to the billing address State - inasmuch as in such cases, the delivery terminates in another State and, therefore, applicant is of the view that they should charge IGST in respect of such supplies - Applicant, therefore, seeks to know as to what tax should be charged on ex-factory inter-State supplies made by them.

Held: IGST is chargeable on ex-factory inter-state supplies since although the goods are made available by the supplier to the recipient at the factory gate, this is not the point where the movement terminates since the recipient subsequently assumes the charge for transportation of the goods up to the destination in another state - place (in the other State) where the goods are destined turns out to be ‘place of supply' in terms of section 10(1)(a) of the IGST Act - consequently, the ‘location of supplier' and the ‘place of supply' fall under different States and the supply qualifies as inter-State supply: AAR

GST - Applicant is a distributor of ‘SCOOPS' brand ice cream and ice cream products are supplied by them to sub-distributors, hotels, party orders and retail outlets - applicant has sought a ruling on the activities viz. ice cream and allied products, milk shakes served in the parlour with or without adding any ingredients like fruits or topping sauces; sold in the parlour as such i.e. in cups, cones, bars, sticks, novelties, 1/2 litre packs, party pack and bulk packs etc., party orders i.e. sale of bulk ice creams to caterers as take away; serving of ice cream with ingredients like fruits or topping as per guests requirements or taste; ice cream products of cups, cones, bars, sticks, novelties etc. sold to pushcart vendors who in turn sell it to their customers - Applicant contends that all these activities the ice cream/milk shakes are for human consumption with our without adding some ingredients and, therefore, the applicable rate of tax is 5% without ITC as per amending notification 46/2017-CTR.

Held: Parlour would fall within the term ‘eating joint' and supply of ice cream along with or without service activities would fall within the definition of ‘Restaurant service'; attract GST @5%, Sl. no. 7(ii) of 11/2017-CTR without ITC - Sale of bulk ice creams to caterers as takeaway (Party orders) does not involve any service and, therefore, is to be reckoned as supply of goods, hence 11/2017-CTR is not applicable - Supply/serving of ice creams with ingredients like fruits or topping as per guest requirements at customers premises is covered under Sl. no. 7(iv) of 11/2017-CTR and attracts @5% GST (from 15.11.2017 to 30.09.2019 under Sl. no. 7(v), GST @ 18%) - ice cream and allied products sold to pushcart vendors does not involve any element of service, hence 11/2017-CTR is inapplicable: AAR

GST - Retrofitted vehicle (scooter) to enable it to be driven by a disabled person merits classification under heading 8711 2019 and attracts GST @28% - tax paid on purchase of such vehicle (scooter) is entitled for ITC - contention of applicant that such retrofitted scooter merits classification under heading 8713 1090 and would attract GST @5% [Entry 243, Schedule I to 1/2017-CTR] as ‘Carriage for disabled person' is untenable: AAR

GST - Supply of services in the form of supply of food and drinks to Educational institutions is covered under Entry no. 66 of 12/2017-CTR and is exempted - amount received for such exempted service is not liable for tax deduction at source u/s 51 of the Act: AAR

GST - Kraft paper made honeycomb board is classifiable under heading 4808 9000: AAR

GST - Works Contract Service provided by applicant to National Centre for Biological Sciences (NCBS) for construction of hostel building is liable to tax @18% as such supply is covered under Item no. 3(xii) of 11/2017-CTR - NCBS is not covered under the definition of a ‘government entity' as per clause (x) of 11/2017-CTR so as to be covered under Entry 3(vi) of 11/2017-CTR and attract GST @12%: AAR

GST - In the case of manufacture of Die by the Thailand supplier, if applicant physically imports the Die to a place in India, then applicant has to pay IGST on reverse charge mechanism and claim the IGST paid as ITC subject to conditions - Further, if the steel Die belonging to the applicant is scrapped at the location of the overseas supplier without the Die coming to India, then such transaction is occurring outside taxable territory and hence not under the purview of the GST Act(s): AAR

GST - If the Die is manufactured by applicant and invoiced to the recipient, without moving the goods, the applicant has to raise tax invoice addressed to the foreign buyer - since it is an intra-state supply he has to collect CGST and SGST and discharge liability - applicant is not entitled to claim said payment as ITC as he is not the recipient - in case the steel Die is scrapped at the applicant's end without moving out of the country, while supplying the Die scrap to a third party, the applicant has to issue intra/inter state tax invoice as applicable and collect and pay applicable tax: AAR

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges that the respondent had not passed on the benefit of reduction in the rate of GST on purchase of ‘Maybelline FIT Me Foundation' inasmuch as the rate of GST on the said product was reduced from 28% to 18% w.e.f 15.11.2017 - DGAP in his report dated 28.03.2018 concluded that the basic price of the impugned goods was increased by the respondent as a result of which the respondent had not passed on the benefit of tax reduction and had thus contravened the provisions of s.171 of the Act; that an amount of Rs.15,861/- was established as the profiteered amount - Authority by its order dated 25.09.2018 had directed the respondent to refund an amount of Rs.41/- along with applicable interest to the applicant and the balance amount of profiteering of Rs.15,820/- was directed to be deposited in the Consumer Welfare Fund as per rule 133(3)(c) of the CGST Rules, along with interest - since the respondent had vide their submission dated 18.05.2018 admitted that the benefit on account of reduced tax rate amounting to Rs.1,98,46,438/- might not have been passed by them to certain customers who had purchased the product in the post-rate reduction period, the Authority had directed the DGAP to investigate the above admission - respondent also submitted that they had not profited in any manner; that they have filed a Writ Petition in the Delhi High Court challenging the order passed earlier - respondent in their replies inter alia submitted that they had inadvertently computed the total amount incorrectly inasmuch as it should have been Rs.1,60,80,372/- based on the methodology adopted by DGAP - DGAP in its report stated that the profiteered amount in respect of all the impacted products comes to Rs.15,37,04,697/- - Authority observes that the respondent's submissions dated 18.02.2020 and 24.02.2020 and the accompanying data/information are voluminous and require thorough scrutiny and may entail a revised mathematical computation of the amount of profiteering, notwithstanding the previous clarifications of the DGAP contained in its supplementary reports dated 02.12.2019, 08.01.2020 and 07.02.2020 - Therefore, Authority is of the view that the matter needs further investigation based on the complete data that has been submitted by the respondent only on 18/24.02.2020 - Without going into the merits of the case and without considering the contentions and submissions of the respondents, Authority finds it imperative that there is a need for revisiting the investigation and recomputation of the profiteered amount - Authority directs the DGAP to reinvestigate the present case as mentioned under rule 133(4) of the Rules, 2017 and furnish his report accordingly under rule 129(6) of the Rules within a period of three months - Order is being passed on 04.06.2020 considering the provisions of rule 133(1) and the notification 35/2020-CT: NAA

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges profiteering by respondent inasmuch as it is alleged that the respondent had not passed on the benefit of reduction in the GST rate from 18% to 5% w.e.f 15.11.2017 by way of commensurate reduction in price - it is alleged that the respondent increased the base price of ‘Dinner Veg.' From Rs.862/- to Rs.929/- and that of ‘Dinner Non-Veg.” From Rs.969/- to Rs.1039/- when the fact is that the GST rate was reduced from 18% to 5% - applicant has enclosed copies of invoices dated 09.11.2017 and 15.11.2017 to substantiate their allegations - DGAP has in its detailed report dated 24.09.2019 submitted that the respondent M/s Barbeque Nation has profiteered by an amount of Rs.32,58,84,772/- which includes GST on the base profiteered amount - DGAP in its report has submitted that he has computed the profiteered amount by comparing the average base prices of the products/SKUs which the respondent was charging during the pre-rate reduction period viz. 01.11.2017 to 14.11.2017 or the earlier period if no sale of a particular product had been made during the subject period with the monthly average base prices of the same product/SKU of which the supply was made by the respondent - NAA is of the view that the methodology employed by the DGAP is not in consonance with the methodology which has been determined by the Authority in respect of all such cases of tax reduction in which benefit was required to be passed on by the registered persons as per the provisions of s.171 of the CGST Act, 2017 - Furthermore, Authority has consistently held that while computing the profiteered amount the average pre-rate reduction base price of each SKU should be compared with the actual post rate reduction base price of the same SKU so that every recipient gets the benefit of tax reduction on each purchase made by him as is the mandate of section 171 otherwise it would result in denial of benefit to the eligible customers and which would amount to contravention of s.171 as well as Article 14 of the Constitution - comparing the average pre-rate reduction base prices with the average post-rate reduction base prices runs completely contrary to the methodology determined by the Authority as well as the provisions of s.171 of the Act - it also leads to the conclusion that the profiteered amount calculated by the DGAP on the basis of the above methodology is not accurate and hence the same cannot be accepted to be correct - moreover, the quantum of benefit computed by the DGAP on each SKU which is required to be passed on to the eligible buyers is also not correct - respondent cannot be allowed to enrich himself at the expense of the customers who are voiceless, unorganised and vulnerable and appropriate the benefit of tax reduction which he is not required to pass on from his own pocket as it has been granted by the Central and the State governments from their scarce tax revenue - reasons given by DGAP for diverting from the approved methodology on the ground that the invoice wise details of outward taxable supplies were not supplied by respondent for the period from 15.11.2017 to 31.03.2019 are not convincing and justified as the respondent was bound to supply the above details - DGAP has also not recorded in his report as to whether the applicant no. 1 was eligible for refund of the profiteered amount or not - report dated 24.09.2019 by the DGAP cannot be accepted and, therefore, the DGAP is directed to conduct further investigation in the present case under rule 133(4) of the Rules in consonance with the directions (as detailed) and submit fresh report as per provisions of rule 129(6) of the Rules - report is to be submitted within three months - order passed on 21.05.2020 keeping in view the provisions of notification 35/2020-CT: NAA

GST - Anti-Profiteering - Section 171 of the CGST Act, 2017 - Applicant alleges that the respondent had resorted to profiteering in respect of supply of construction services related to the purchase of flat in the respondent's project ‘Hero Homes', Gurugram - applicant has also alleged that the respondent had not passed on the benefit of Input Tax credit by way of commensurate reduction in the price of the apartment purchased by him - DGAP in its report stated that prior to implementation of GST w.e.f 01.07.2017, service tax on construction service was chargeable @4.50% (14/2015-ST) and after implementation of GST, GST on construction service was chargeable @18% (effective rate was 12% in view of 1/3rd abatement on value) vide 11/2017-CTR and the effective rate of construction service in respect of affordable and low-cost homes was @8% effective vide 1/2018-CTR - DGAP has, therefore, observed that in the case of construction service, the effective rate of tax @4.5% in pre-GST era was lower than the effective rate of tax @8% or @12% in post-GST era; that the price charged for the said residential flat was a new project developed and constructed by respondent after implementation of GST, hence the anti-profiteering provisions would not be applicable; that the first booking in the project was made on 22.12.2018 and there was no price history of the units sold in the pre-GST era which could be compared with the post-GST base price to determine whether there was any profiteering; that in the present case, the registration and approval of the project, building plan, the launching of the project, allotment of units, receipt of payments etc. had all taken place in the post-GST regime, therefore, there was no pre-GST tax rate or ITC structure which could be compared with the post-GST tax rate and ITC - DGAP has concluded that in view of its aforesaid findings, it appeared that s.171(1) of the CGST Act has not been contravened by the respondent in the present case - said report of DGAP has been received by the Authority on 10.12.2019.

Held: Authority has carefully examined the report of DGAP and finds that there has been no reduction in the rate of tax in the post-GST period - moreover, the respondent had launched the project ‘Hero Homes' in the post-GST regime and there was no demand raised by the respondent in the pre-GST regime; that the registration and approval of the project, launching of the project and receipt of payments had taken place in the post-GST regime and hence, there was no pre-GST tax rate or ITC structure which could be compared with the post-GST tax rate and ITC; therefore, the respondent had neither benefited from additional ITC nor had there been any reduction in the tax rate in the post-GST period and, therefore, it does not qualify to be a case of profiteering - Authority finds no reason to differ from the report of DGAP, hence it is concluded that the provisions of s.171 of the CGST Act, 2017 have not been contravened in this case - applicant has also stated that he is in agreement with the investigation report dated 06.12.2019 furnished by the DGAP - allegation that the respondent has not passed on the benefit of ITC in this csae is not found sustainable - application filed by applicant requesting action against respondent for alleged violation of provisions of s.171 of the CGST Act is dismissed as being not maintainable: NAA

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - DGAP had initiated proceedings against the respondent and included him as a co-noticee on 06.06.2019 in the already issued notice dated 10.04.2019 for collecting evidence necessary to determine whether the benefit of reduction in the rate of GST from 28% to 18% had been passed on by M/s Vini Cosmetics P Ltd. and the respondent to their recipients in respect of all the products impacted by such GST rate reduction w.e.f 15.11.2017 by way of commensurate reduction in prices in terms of s.171 of the CGST Act, 2017 - DGAP has observed (in report dated 24.09.2019) that the GST rate on the product “Fogg Deo Fougere BX 150ml” was reduced from 28% to 18% w.e.f 15.11.2017; that from the documents submitted by M/s Vini Cosmetics it was evident that he had reduced the MRP of the product from 299/- to Rs.275/- w.e.f 15.11.2017; that consequent upon the rate reduction, the commensurate reduction in the revised MRP should have been Rs.275.64 [Rs.299 x 1.18/1.28] and which showed that M/s Vini Cosmetics had indeed passed on the benefit of rate reduction to the end user/final consumer; that M/s Vini Cosmetics had not only revised downwards his prices of the impacted products commensurately but had also communicated the same to all his super-stockists to re-sticker the product and pass on the benefit to the end users/final consumers and had thus not contravened the provisions of s.171 of the Act - however, the respondent had increased the base prices of the products when they were sold to distributors/modern trade and hence had not passed on the benefit of rate reduction to his recipients and hence the benefit had not been passed on to the end users/final consumers - DGAP has concluded that the amount of net higher sales realization on account of the increase in the base price of the product despite reduction in the GST rate from 28% to 18% came to Rs.8,50,442/- inclusive of excess GST so collected by respondent from recipient - Authority is in agreement with the report of DGAP - accordingly, respondent is directed to reduce his prices commensurately in terms of rule 133(3)(a) of the CGST Rules; deposit the profiteered amount of Rs.8,50,442/- in the Consumer Welfare Fund of the Central and the Delhi State Government along with interest @18% since the recipients/buyers are not identifiable - amount to be deposited within three months and report thereon is to be submitted by the Commissioners of CGST/SGST concerned - for the contravention, penalty is imposable u/s 171(3A) of the Act, 2017 - order passed taking note of notification 35/2020-CT: NAA

GST - Anti-Profiteering - s.171 of the CGST Act, 2017 - Applicant alleges profiteering by the respondent in the matter of supply of “Food Processor” inasmuch as it is alleged that the respondent has not passed on the benefit of GST at the time of implementation of GST w.e.f 01.07.2017 - applicant relies on two invoices issued by respondent, pre and post GST, one dated 09.05.2017 and the other dated 22.12.2017 - DGAP in its report dated 14.08.2019 has stated that the GST rate on the impugned product was reduced from 28% to 18% vide notification 18/2018-CTR; that the impugned product was imported from outside India and was liable to countervailing duty @12.50% on the abated MRP apart from VAT; therefore, the average tax incidence in the pre-GST era was 29.80% which was reduced to 28% upon implementation of GST; that the amount of profiteering made by respondent for failing to pass on the benefit of reduction in the rate of tax to recipients in terms of s.171 of the Act worked out to Rs.4,53,949/- after considering the details of outward supplies during the period 01.07.2017 to 31.12.2018; that by increasing the basic price of the impugned product consequent upon reduction in the rate of tax, the commensurate benefit of implementation of GST was not passed on to the recipients - Authority agrees with the report of the DGAP - respondent is directed to deposit the profiteered amount along with interest @18% in the Consumer Welfare Fund of the Centre as well as State equally as per the provisions of rule 133(3)(c) of the CGST Rules - this amount to be deposited within three months and report be submitted by the Commissioners concerned - penalty is imposable u/s 171(3A) of the Act for the contravention - since DGAP has established that the respondent has contravened the provisions of s.171 of the Act while selling the product ‘Food processor' it becomes inevitable to investigate the profiteering aspect in respect of other impacted periods too which have been supplied by the respondent - authority directs DGAP to investigate into all the other impacted products which have been supplied by the respondent and a detailed report be submitted u/r 133(5) of the Rules: NAA

GST - Rejection of refund claim - Time period for issuance of order u/ 54 extended till June

Relief for merged UTs of Daman and Diu & Dadra and Nagar Haveli - Due date extended till July 31 for compliance