Home Case Index All Cases GST GST + NAPA GST - 2020 (1) TMI NAPA This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (1) TMI 1370 - NAPA - GSTProfiteering - FMCG - 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 - extension sought for period of Investigation - Contravention of provisions of section 171 of the Central Goods and Services Tax Act, 2017 - penalty. HELD THAT: - It is revealed that the DGAP vide his Report dated 5-7-2019 has computed the profiteered amount as ₹ 2,16,49,61,535/- which has been shown at the Table given in his Report dated 23-12-2019. However, vide Sr. No. 2 of the Table, the DGAP has submitted that an amount of ₹ 19,75,12,265/- can be reduced from the above profiteered amount on account of rectification of the non-averaging of the base prices where description was used for comparison ((1-10-2017 to 14-11-2017 (Goods Desc.) and 1-9-2017 to 30-9-2017 (Goods Desc.)). However, the DGAP has also stated that the above rectification could be made if it was decided to do so by this Authority. The DGAP has not mentioned the reasons on the basis of which such an approach can be approved by this Authority. He has also not explained why the above approach was not applied by him at the time of preparing of his Report dated 5-7-2019. Vide Sr. No. 3 of the Table the DGAP has also submitted that an amount of ₹ 4,80,88,937/- can be excluded from the original profiteered amount due to rectification of inconsistency in the sequence followed by him in respect of certain line items in case it is so decided by this Authority. However, no explanation has been given why the above inconsistency cannot be rectified by him in case such an error has taken place. This Authority cannot pass any order on the above issue unless all the facts are placed before it by the DGAP along with the reasons why this inconsistency has taken place. The DGAP has also stated vide Sr. No. 4 of the Table produced, that an amount of ₹ 5,18,75,235/- could be subtracted from the profiteered amount on the ground of rectification of the adopted average price on description wherever comparable product code was used subject to the approval of this Authority. However, no reasons have been given why the above approach was more appropriate as compared to the approach which was adopted by the DGAP while computing the profiteered amount vide his Report dated 5-7-2019. 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 the Reports dated 5-7-2019 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. Perusal of the Respondent's submissions also shows that he has not furnished the following details pertaining to his claim of having passed on the benefit of rate reduction by increasing the grammage/volume of his products:- (i) Name of the SKU (ii) Base price of the SKU pre-rate reduction with documentary evidence (iii) Weight/Volume of the SKU pre-rate reduction with documentary evidence (iv) Commensurate base price of the SKU post-rate reduction with details of computations (v) Commensurate increase in the weight/Volume required post-rate reduction with computations (v) Increase in the weight in grams/mls (vi) Whether the increase is commensurate with the rate reduction (vii) Date of passing on the benefit of tax reduction with documentary evidence (viii) Amount of benefit of tax reduction passed on the SKU (ix) Amount of benefit of tax reduction passed on State/Union Territory wise Accordingly, the Respondent is directed to supply the above information to the DGAP within a period of 30 days from the date of this order. The above information shall be examined by the DGAP and his findings shall be included in the fresh Report to be filed by him in consequence of this Oder. The Respondent is further directed to supply the required information and extend all co-operation to the DGAP during the course of the fresh investigation - The DGAP is also directed to supply detailed list of the SKUs impacted by the rate reduction w.e.f. 15-11-2017 along with the pre-rate reduction base price and the commensurate reduced base price post-rate reduction with percentage of increase/reduction made by the Respondent in respect of such SKU. Documents to be supplied, after which the decision will be made.
|