Jagini Rohit C/O Sri Raja Rajeshwari Nilayam Vs Prasad Media Corporation Pvt. Ltd. (NAA)
1. The present Report dated 12.06.2019 has been received from the Director-General of Anti-Profiteering(DGAP) after an investigation in terms of Rule 129(6) of the Central Goods & Service Tax (CGST) Rules, 2017. The brief facts of the instant case are that a reference was received from the Standing Committee on Anti-Profiteering on 06.05.2020 recommending that a detailed investigation be conducted in respect of an Application filed by Applicant No. 1 alleging profiteering by the Respondent in respect of the supply of “Services by way of admission to exhibition of cinematograph films where the price of admission ticket is above one hundred rupees” despite a reduction in the rate of GST from 28% to 18% w.e.f. 01.01.2019. Applicant No. 1 has alleged that the Respondent increased the base price of his movie tickets and thus maintained unchanged total (cum tax) prices of the movie tickets, charged by him from his customers/ recipients, and had thus not passed on to his customers/ recipients. the benefit of reduction in the GST rate from 28% to 18% effected vide Notification No. 27/2018 Central Tax (Rate) dated 31.12.2018. In support of his claim, Applicant No. 1 had submitted a copy of a movie ticket dated 04.01.2019 along with his application.
2. The DGAP has further reported that the Respondent had already been investigated, in respect of the same cinema hall, for profiteering based on another Application dated 28.01.2019, which had been filed by the Principal Commissioner, Hyderabad CGST Commissionerate, wherein it had been alleged that the Respondent had profiteered by not passing on the benefit of the reduction in the rate of tax to his customers/ recipients. DGAP has further reported that based on the investigation carried out by him for the period from 01.01.2019 to 30.06.2019, he had vide his report dated 25.10.2019 furnished under Rule 129(6) of the CGST Rules 2017, concluded that the allegation of profiteering stood confirmed against the same Respondent and that the Respondent had profiteered by the tune of Rs. 30,13,058/-(inclusive of GST) .The DGAP has added that said investigation had revealed that the Respondent was found to have profiteered during the period from 01.01.2019 to 07.02.2019 whereas no profiteering was established for the period after 08.02.2019 since the Respondent had reduced the prices commensurately for all the six screens in his cinema hall.
3. In respect of the current proceedings, the DGAP has reported that the complaint made by Applicant No. 1 was based on a copy of a movie ticket dated 04.01.2019 that he had enclosed with his Application and that the date of the said movie ticket fell within the period for which profiteering has been ascertained against the Respondent and his claim to the benefit was also established.
4. On the issue of quantification of the amount of benefit that the Respondent was required to pass on to the Applicant, the DGAP has reported as follows that there were two classes of screens within the multiplex, 2D and 3D screens; that the prices of tickets for Screens 1 to 5 (2D Movies) were different from the tickets for Screen 6 (3D Movies); that the ticket pricing varied, based on the screen where a movie was exhibited; that the case of Applicant No. 1 pertained to a 2D movie KGF screened in Screen No. 1 of Respondent’s multiplex having Rs 150/- as the ticket price; that the computation of profiteering in respect of Applicant No. 1 was worked out as per Table-A below:-
Table-LA’
(Amount in Rs.)
