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TMI Blog2019 (6) TMI 1265X X X X Extracts X X X X X X X X Extracts X X X X ..... the closing stock as on 26.07.2018 and ₹ 4,387.63/- on the fresh stock for the period 27.07.2018 to 30.09.2018. The Respondent has neither disputed the quantity nor the profiteered amount as has been arrived at by the DGAP. The Respondent is hereby directed to reduce the price of the product as per the provisions of Rule 133 (3) (a) of the CGST Rules, 2017, by making commensurate reduction in the price, keeping in view the reduction in the rate of tax so that the benefit is passed on to the recipients. Penalty - HELD THAT:- Respondent has issued incorrect invoices while selling the above products to his recipients as he has not correctly shown the basic prices which he should have legally charged from them. The Respondent has al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Standing Committee on Anti-profiteering in its meeting held on 06.09.2018, and it was decided, to refer the matter to the Director General of Anti-Profiteering (DGAP) to initiate detailed investigation in the matter. 3. The DGAP after completing the investigation has submitted his report under Rule 129 (6) of CGST Rules, 2017 on 02.04.2019 for the period 01.07.2018 to 30.09.2018. 4. The DGAP in his report has stated that a notice under Rule 129 of the CGST Rules, 2017 was issued on 15.10.2018, calling upon the Respondent to reply as to whether he admitted that the benefit of reduction in GST rate had not been passed on to the recipients by way of commensurate reduction in price and if so, to suo-moto determine the q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort has admitted that the Respondent had purchased the product at an average base price of ₹ 57.70/- while the average selling price of the same product during the said period was ₹ 60.58/-, thus, the profit margin for the Respondent during the pre-rate reduction period was ₹ 2.88/- per unit. 7. The DGAP has also submitted that the Respondent had a closing stock of 16 units of the product when the rate of tax was reduced from 12% to NIL w.e.f. 27.07.2018 without the benefit of ITC. Hence the Respondent was not entitled to avail ITC on the closing stock and the commensurate price of the closing stock of the product as on 26.07.2018, should have been the sum total of ₹ 57.70/(basic purchase price), ₹ 6.9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice, out of which 266 units were supplied from the closing stock as on 26.07.2018. 10. Accordingly the DGAP has submitted that the profiteered amount on account of the sales made from the closing stock as on 26.07.2018 was ₹ 894.88/- and for the 1038 units sold from the stock purchased post GST rate reduction (after 26.07.2018) at a price above the commensurate price the profiteered amount was ₹ 4,387.63/-. Thus the Respondent has sold 1513 units during the period 27.07.2018 to 30.09.2018, at a price above the commensurate price and profiteered an amount of ₹ 5,282.51/-, as has been furnished in Annex-15 of the DGAP's Report where all the supplies were made in the State of Delhi only. 11. On perusal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong with his letter to the Principal Chief Controller of Account, New Delhi stating that the amount of ₹ 5,283/- was being deposited in the account of Central Consumer Welfare Fund (₹ 2,641.50/- and State of Delhi Consumer Welfare Fund ₹ 2,641.50/-) respectively. 13. We have carefully considered the Report of the DGAP and all the submissions placed on record. It's an admitted fact that the rate of tax on the product was reduced from 12% to NIL w.e.f. 27.07.2018 without the benefit of ITC. The DGAP vide Annexure-15 of his Report dated 29.03.2019 has found that the Respondent had increased his base price inspite of reduction in the rate of tax from 12% to NIL. Accordingly the DGAP has arrived at profiteered amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o that the benefit is passed on to the recipients. The Authority also confirms and determines the profiteered amount at ₹ 5,282.51/- and directs the Respondent to deposit this amount along with interest @18% into the Central and Delhi State Consumer Welfare Fund in the ratio of 50:50 since the supplies have been made in the State of Delhi as per Rule 133 (3) (c) of the CGST Rules, 2017 16. The amount of ₹ 5,283/- paid by the Respondent vide demand draft dated 06.06.2019 along with interest of ₹ 900/- paid through HDFC Bank demand draft no. 023223 dated 20.06.2019 is taken on record. This amount of ₹ 5,283/- is to be accounted in the ratio of 50:50 i.e. ₹ 2,641.50/- into the Central Consumer Welfare Fun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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