9911796707
TMI Blog2019 (6) TMI 1266X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Goods and Service Tax (CGST) Rules, 2017. The brief facts of the present case are that an application was filed before the Standing Committee on Anti-Profiteering under Rule 128 of the CGST Rules, 2017, by the Applicant No. 1, alleging that he had purchased a footwear (here-in-after referred to as the product) at a price of Rs. 699/- from the Respondent and the Respondent had not passed on the benefit of rate reduction of GST from 18% to 5% to him by way of commensurate reduction in price. The Applicant No. 1 further submitted that by doing so, the Respondent had indulged in profiteering and had contravened the provisions of Section 171 of the CGST Act, 2017 and hence appropriate action should be taken against him. He further submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but he also did not avail this opportunity. 4. The DGAP had requested for granting extension to complete the investigation up to 09.12.2018 which was allowed by this Authority under Rule 129 (6) of the above Rules, vide its order dated 26.12.2018. The present investigation pertains to the period between 27.07.2018 to 30.11.2018. 5. The DGAP in his Report has stated that the Respondent had submitted his replies vide his emails/letters dated 12.11.2018, 16.1 1.2018, 03.12.2018, 14.12.2018, 26.12.2018, 07.01.2019, 05.02.2019, 12.03.2019 and 13.03.2019. The Respondent had submitted that he was running an exclusive showroom of M/s. Liberty Shoe Ltd., which had given him the software which was being used for billing and he could not make any m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 1,000/-, from 18% to 5%, vide Notification No. 18/2018-Central Tax (Rate) dated 26.07.2018 which was not in dispute. The Report further stated that the Respondent was required to sell the product at the base price of pre-rate revision of 26.07.2018 and should have charged lower GST @ 5% w.e.f. 27.07.2018 on such base price, to pass on the benefit of reduction in the rate of tax from 18% to 5%. But based on invoices submitted by the Respondent it was noticed that the base price of the product was increased to maintain the pre-GST rate reduction cum-tax price charged from the recipients. The DGAP has also informed that from the invoice of the product, the base price (excluding GST), was increased from Rs. 592.37/- to Rs. 665.71/- which ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GAP. This amount was inclusive of Rs. 77/-, which was the profiteered amount in respect of the Applicant No. 1. 9. The above Report which was received on 03.04.2019 and was considered by the Authority in its meeting held on 03.04.2019 and it was decided to hear the Applicants and the Respondents on 23.04.2019. The hearing was further adjourned to 27.05.2019. 10. During the hearings held on 27.05.2019 and 07.06.2019 none appeared for the Applicant No. 1, the Applicant No. 2 was represented by Smt. Neelam Kapur, Superintendent and the Respondent was represented by Sh. Rishabh Aggarwal, Chartered Accountant. 11. The Respondent vide his written submissions dated 28.05.2019 has stated that when the rate of tax was reduced from 18% to 5% the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he submissions made by the Respondent, dated 27.05.2018 and it has been revealed that the Central Govt. vide Notification No. 18/2018- Central Tax (Rate) dated 26.07.2018 had reduced the rate of GST from 18% to 5% in respect of footwear priced between Rs. 500/- to Rs. 1000/-, with effect from 27.07.2018 and the benefit of the same was required to be passed on to the recipients by the Respondent as per the provisions of Section 171 of the CGST Act, 2017. 13. From the above facts and discussions it is evident that the Respondent had increased the base price of the product from Rs. 592.37/- to Rs. 665.71/-, when the rate of tax was reduced from 18% to 5% with effect from 27.07.2018. Thus, by increasing the base price of the product the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicant No. 1 along with interest @18% from the date when this amount was received by him from the Applicant No. 1 and deposit the remaining amount of profiteering of (Rs. 6,55,307/- (-) Rs. 77/- = Rs. 6,55,230/- (Rupees Six Lakhs Fifty Five Thousand Two Hundred Thirty Only) along with interest @18% in terms of Rule 133 (3) (d) of the CGST Rules, 2017. Further the Respondent is directed to deposit Rs. 6,55,230/- into the Consumer Welfare Fund of the Central and the concerned State Governments as per the provisions of Rule 133 (3) (c) of the CGST Rules, 2017 in the ratio of 50:50, within a period of 3 months as is given in the Table below:- No. State Code State (Place of Supply) Profiteered Amount (Rs.) 50% of the Profiteered Amount (Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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