Case Law Details
Director General of Anti-Profiteering Vs M/s Neeva Foods Pvt, Ltd. (National Anti-Profiteering Authority)
1. The present Report dated 27.12.2019 has been furnished by the Director General of Anti-Profiteering (DGAP), under Rule 129 (6) of the Central Goods & Services Tax (CGST) Rules, 2017, The briefzs facts of the case are that a reference was received by the DGAP from the Standing Committee on Anti-Profiteering on 28.06.2019 recommending a detailed investigation in respect of an application, originally examined by the Maharashtra State Screening Committee on Anti-profiteering under Rule 128 (2) of the CGST Rules 2017, alleging profiteering in respect of restaurant service supplied by the Respondent (Franchisee of M/s Subway India Pvt, Ltd.). In the application, it was alleged that despite reduction in the rate of GST from 18% to 5% w.e.f. 15.11.2017, the Respondent had not passed on the commensurate benefit of tax reduction as he had increased the base prices of his products. A summary sheet of the extent of profiteering was prepared by the State Tax Officer, Mumbai which was also enclosed with the recommendation of the Standing Committee. On receipt of the said reference from the Standing Committee on Anti-profiteering, a notice under Rule 129 (3) was issued on 10.07,2017 by the DGAP. calling upon the Respondent to reply as to whether he admitted that the benefit of reduction in GST rate w.e.f. 15.11,2017, had not been passed on to his recipients 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 the supporting documents. The Respondent was also allowed to inspect the relied upon non-confidential evidence/information which formed the basis of the investigation between 17.07.2019 and 19.07,2019, which was however not availed of by the Respondent.
2. The DGAP has reported that the period covered by the current investigation was from 15,11.2017 to 05.2019_
3. The DGAP has also reported that in response to the notice dated 07.2019 and subsequent reminders, the Respondent has submitted his replies vide his letters/e-mails dated 22.07,2019, 15.09.2019, 27.09.2019, 09.10.2019, 11,11.2019, 18.11.2019, 28.11.2019, 29.11.2019, 03.12_2019, 09.12,2019 and 24.12.2019, whereby the Respondent has submitted:-
a) That as per his working, ITC amounting to 4,21.385/- was available to him during the period from 01.07.207 to 14.11.2017, which came to approx 10%. The Increase in prices was only commensurate to the loss/denial of ITC which was earlier permitted in terms of capital nature/assets purchased and other purchases/expenses during the year. Thorefore, by doing so, he has passed benefit on the pricing of goods to the extent which covered the loss of denial of ITC w e.f. 15.11.2017.
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