Director General of Anti-Profiteering Vs L’Oreal India Pvt. Ltd (National Anti-Profiteering Authority)
Facts of the Case:
The brief facts of the case are that it was alleged that the Respondent had not passed on the benefit of reduction in the rate of GST on the Fast Moving Consumer Goods (FMCGs) being supplied by him, when the rate of GST was reduced from 28% to 18% w.e.f. 15.11.2017. The issue of not passing on the benefit of tax reduction was examined by the Standing Committee on Anti-Profiteering under Rule 128 (1) of the above Rules and it was decided to refer the matter to the DGAP to conduct a detailed investigation in the matter, in its meeting held on 13.12.2018.
Held by NAA:
It is clear from the above narration of the facts that the DGAP has left the rectification of the above claims on this Authority however; no grounds have been mentioned on the basis of which this Authority can decide why the above recommendations of the DGAP should be accepted. In the absence of clear cut findings on the above issue this Authority cannot pass reasoned and just order. In view of the above the Reports dated 05.07.2019 and 23.12.2019 furnished by the DGAP cannot be accepted and he is directed to cause further investigation on the above issues and furnish fresh Report in terms of Rule 133 (4) of the CGST Rules, 2017.
FULL TEXT OF ORDER OF NATIONAL ANTI-PROFITEERING AUTHORITY
1. This Report dated 05.07.2019 and the supplementary Reports dated 11.12.2019 and 23.12.2019 have been received from the above Applicant (here-in-after referred to as the DGAP) after detailed investigation under Rule 129 (6) of the Central Goods & Service Tax (CGST) Rules, 2017. The brief facts of the case are that it was alleged that the Respondent had not passed on the benefit of reduction in the rate of GST on the Fast Moving Consumer Goods (FMCGs) being supplied by him, when the rate of GST was reduced from 28% to 18% w.e.f. 15.11.2017. The issue of not passing on the benefit of tax reduction was examined by the Standing Committee on Anti-Profiteering under Rule 128 (1) of the above Rules and it was decided to refer the matter to the DGAP to conduct a detailed investigation in the matter, in its meeting held on 13.12.2018.
2. The DGAP had issued Notice under Rule 129 (3) of the CGST Rules, 2017 on 15.01.2019 to the Respondent, to submit his reply as to whether he admitted that the benefit of reduction in the 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 to furnish all the documents in support of his reply. The Respondent was also afforded an opportunity to inspect the non-confidential evidences/information which formed the basis of the said Notice, during the period from 21.01.2019 to 23.01.2019, which the Respondent had availed and inspected the documents on 23.01.2019.
3. The DGAP has conducted the present investigation from 15.11.2017 to 31.12.2018. He had also sought extension of the time limit to complete the investigation from this Authority, which was granted to him.
4. The DGAP has stated that the Respondent had replied to the Notice vide his letters/e-mails dated 22.01.2019, 08.02.2019, 18.02.2019, 19.06.2019, 20.06.2019, 21.06.2019, 25.06.2019, 26.06.2019, 27.06.2019 and 28.06.2019. The reply of the Respondent as intimated by the DGAP in his Report is as follows:-
5. That the Respondent was engaged in the manufacture and sale of more than 12,000 Stock Keeping Units (SKUs) under 5 major categories, which are furnished in Table given below:-
Table
