Case Law Details
Shri Rahul Sharma Vs M/s Gyan Books Pvt Ltd. (National Anti-Profiteering Authority)
In the present case, we observe that that the book “Ragas in Hindustani Music: Conceptual Aspects (without cassette)” deals with various conceptual aspects and various affinities in Ragas and analysis thereof. We observe that the invoices dated 24.09.2018 and 09.01.2019, issued by the Respondent in respect of supply of the said book “Ragas in Hindustani Music: Conceptual Aspects (without cassette)” to his buyers does not contain the HSN code, which is a requirement under the provisions of Section 31 of the CGST Act, 2017. We observe that the main allegation of the Applicant No. 1 is that the Respondent had maintained the same selling price for the book even after the Notification No. 25/2018-Central Tax (Rate) dated 31.12.2018 had come into force and that the Respondent had not passed the benefit of reduction in the GST rate to the recipients. In this context, we have perused the invoices dated 24.09.2018 and 09.01.2019, issued by the Respondent in respect of supply of the said book “Ragas in Hindustani Music: Conceptual Aspects (without cassette)” and we observe that the Respondent has not charged any GST from his buyers in case of both the supplies, one effected before the rate reduction and the other after that date. Since no GST was charged by the Respondent before and after the relevant date i.e. 01.01.2019, question of profiteering does not arise in this case.
FULL TEXT OF ORDER OF NATIONAL ANTI-PROFITEERING APPELLATE AUTHORITY
1. The present Report dated 11.06.2019 has been received from the Applicant No. 2 i.e. the Director General of Anti-Profiteering (DGAP) after detailed investigation under Rule 129(6) of the Central Goods & Service Tax (CGST) Rules, 2017. The brief facts of the present case are that the Standing Committee on Anti-Profiteering vide the minutes of its meeting held on 11.03.2019 had forwarded an application dated 28.02.2019 filed by the Applicant No. 1, to the DGAP. The Applicant No. 1 had stated in his application that the Respondent had resorted to profiteering in respect of supply of the book titled “Ragas in Hindustani Music: Conceptual Aspects (without cassette)”. The Applicant No. 1 had also alleged that the Respondent had maintained the same selling price for the above said book despite reduction in the GST rate from 12% to NIL vide Notification No. 25/2018-Central Tax (Rate) dated 31,12.2018, which took effect on 01.01.2019 and that the Respondent had not passed on the benefit of reduction in the GST rate to the recipients by way of commensurate reduction in the price of the book. The said application was examined by Standing Committee on Anti-Profiteering, in its meeting held on 11.03.2019, and it had referred the application to DGAP to conduct a detailed investigation in the matter under Rule 129(1) of the CGST Rules, 2017 to determine whether the benefit reduction in the rate of tax or ITC had been passed on by the Respondent to his recipients.
2. Thereafter, the DGAP issued a notice to the Respondent on 09.04.2019 under Rule 129 of the CGST Rules, 2017 calling upon the Respondent to reply as to whether he admitted to the allegation made by the Applicant No. 1 that the benefit of reduction in the GST rate from 12% to Nil, had not been passed on to the Applicant No. 1 by way of commensurate reduction in prices and if so, to suo-moto determine the quantum thereof and indicate the same in his reply to the Notice as well as furnish all supporting documents. The Respondent was also given an opportunity to inspect the non-confidential evidences/information furnished by the above Applicant during the period 15.04.2019 to 17.04.2019. However, the Respondent did not avail of the said opportunity. The Applicant No. 1 was also given an opportunity to inspect the non-confidential evidences/reply furnished by the Respondent on 20.05.2019 or 21.05.2019. However, the Applicant No. 1 also did not avail of the said opportunity.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
RIDER
Section 171 of the CGST Act READS:
(1). “ANY REDUCTION IN RATE OF TAX on any supply of goods or services or THE BENEFIT OF INPUT TAX CREDIT shall be passed on to the recipient by way of commensurate reduction in prices.”
FONT< To focus on the fact that the provision clearly covers (as is intended by the conjunction ‘or’) two different criteria / situations for the provision to apply; ‘ANY REDUCTION IN RATE OF TAX’ and ‘THE BENEFIT OF INPUT TAX CREDIT’.
Now, Turning to the raging controversies, – in own view seemingly unfounded by logic or sound reasoning- those are, it appears, attributable to the fact of reading and construing the intent behind by failing to appreciate the material legal significance of the above stated fact – Any eminent experts' thoughts?!
OFFHAND
The reported case, as is readily to be noted, makes for a bizarre instance of its kind; in that, right from the stage of initiation and through the entire proceedings neither of the two applicants (for that matter, even the Standing Committee) have cared to mindfully consider why at all the Respondent could be validly proceeded against on the ground of excess ‘profiteering’ .
That clearly goes to illustrate the underlying fact of life / the obtaining field reality – namely, for perpetration and perpetuation of such unsavory litigation on a ‘non-issue’ of the kind herein, ‘credit’ (or blame?) has to go to the so called ‘morons’ at large; notwithstanding that is a class to be preserved/ protected still remains to be investigated and decided upon by ‘our pro bono team’ (thus quipped in a famous cartoon) !