Facts: The Applicant referred the matter to Kerala State Screening Committee on Anti-Profiteering alleging profiteering on the supply of “Matchless Plus TTWG Grinder” (“subject product”). The complaint was forwarded to Director General of Anti-Profiteering (DGAP) for investigation on the subject product. In respect of this, two invoices pertaining to pre-rate revision and post-rate revision were presented. On report of DGAP the National Anti-Profiteering Authority gave findings on the following issue.
Issues Involved: The issued for determination before the Authority was as follows:
- Whether the rate of tax applicable to the subject product was reduced w.e.f. 15.11.2017?
- If so, whether the benefit of such reduction in the rate of tax was passed on by the Distributor to his recipients in terms of Section 171 of the CGST Act, 2017?
Held: The Hon’ble National Anti-Profiteering Authority in M/s Win Win Appliances, Case No. 20/2019, Date of Order 22 March, 2019 observed that the rate of subject product was reduced from 28% to 12% vide Notification No. 41/2017-Central Tax (Rate) dated 14 November, 2017 effective from 15 November, 2017. The invoices submitted by the Petitioner reflects that base price of the product was increased from Rs. 4728.90 to Rs. 4774.59. Therefore, by increasing base price of the product consequent to the reduction in the GST rate, the anti-profiteering clause was attracted.
Further, issuing incorrect invoices by showing increased base price thereby compelling the customers to pay additional GST on the increased prices is an offence under Section 122 (1) (i) of the CGST Act, 2017 and hence, the distributor is liable to penalty. A notice was issued to show cause as to why penalty should not be imposed in this respect.