By TIOL News Service

NEW DELHI, JULY 24, 2024: THE National Anti-Profiteering Authority (NAA) is the statutory mechanism under GST law to check the unfair profiteering activities by registered suppliers under GST law. The NAA's core function is to ensure that the commensurate benefits of the reduction in GST rates on goods and services done by the GST Council and of the input tax credit are passed on to recipients by way of commensurate reduction in prices by the suppliers.

A Press Release by PIB on 28 November 2017, stated:

"In an immediate follow up action of last week's Cabinet approval for creation of the posts of Chairman and Technical Members of the National Anti-profiteering Authority under GST, the Government today issued orders appointing senior IAS officer Shri B.N. Sharma, as the first Chairman of this apex Authority in the rank of Secretary to Government of India. Mr. BN Sharma assumed office on 1st December 2017."

Rule 137 deals with the tenure of the Authority.

It reads -

Rule 137. Tenure of Authority.-

The Authority shall cease to exist after the expiry of two years@# from the date on which the Chairman enters upon his office unless the Council recommends otherwise.

@ 33/2019-Central Tax dated 18 July 2019 - for the words "two years", the words "four years" shall be substituted

# 37/2021-Central Tax dated 1st December 2021 - with effect from the 30th day of November 2021, for the words "four years", the words "five years" shall be substituted.

In the 45th GST council meeting held on 17 September 2021, it was decided to explore possibility of transferring all cases to Competition Commission of India (CCI).

20.7. The Secretary stated that as suggested by the Hon'ble Members, the tenure of NAA can be extended by one year up to 31.11.2022 after which it will close down and meanwhile it can be taken up with the CCI for taking up the work of NAA. He sought authority from the Council to take up the issue with CCI. The Council agreed with this arrangement. [Extract from minutes of the 45th meeting of the GST Council]

Notification 23/2022-Central Tax dated 23 November 2022 reads -

"In exercise of the powers conferred by sub-section (2) of section 171 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Goods and Services Tax Council, hereby empowers the Competition Commission of India established under sub-section (1) of section 7 of the Competition Act, 2002 (12 of 2003), to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him.

This notification shall come into force with effect from 1st day of December, 2022."

It seems this arrangement of empowering the Competition Commission of India to deal with the cases of Anti-Profiteering is coming to an end.

Section 171 of CGST Act is being amended by clause 144 of the Finance (No.2) Bill, 2024 to enable the Government to notify the GST Appellate Tribunal to handle anti-profiteering cases and also empower the Government to notify a date after which the Authority for anti-profiteering shall not accept application for examination.

The PIB release of 6th May 2024 is extracted below -

"Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman administered the oath of integrity and secrecy to Justice (Retd.) Sanjaya Kumar Mishra as the President of the GST Appellate Tribunal (GSTAT), in New Delhi, today. Justice (Retd.) Mishra's appointment marks the beginning of the operationalisation of the GSTAT, a crucial body for resolving GST-related disputes. As per the approval of the GST Council, the Government has notified the Principal Bench, to be located at New Delhi, and 31 State Benches at various locations across the country. Process for appointment of Judicial Members and Technical Members is already in progress. The Tribunal will ensure swift, fair, judicious and effective resolution to GST disputes, besides significantly reducing the burden on higher courts."

As to whether it is a prudent decision to entrust the GST Appellate Tribunal with this additional responsibility of deciding Anti-Profiteering cases, only time will tell. Perhaps, the Settlement Commission!