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2022 (10) TMI 312 - HC - GSTAnti-Profiteering provisions - Constitutional Validity of Section 171 of the CGST Act, Chapter XV of the CGST Rules, more particularly, Rules 126, 127 & 133 of the CGST Rules - vires and violative of Articles 14, 19(1)(g), 265 & 300A of the Constitution of India or not - HELD THAT:- This Court is of the prima facie view that Section 171 is not a charging or a taxing provision. On the contrary, it is an incidental provision in the CGST/SGST Acts, for the purpose of ensuring that the object of these Acts, namely, eliminating the cascading effect of taxation on the consumer is achieved and any benefit of rate reduction of taxes or input tax credit benefit is passed on to the recipient without the middleman taking advantage of the Governments forgoing their taxes for the end consumer. In that sense, this provision is in the nature of a consumer welfare provision. Further, Section 171 of the CGST Act, 2017 casts an obligation of every supplier of goods and services/registered person to pass on the benefit of rate reduction of GST or the benefit of ITC on every supply and not on some supplies. Consequently, prima facie, a supplier cannot claim that he has passed on more benefit to one customer therefore he could pass less or no benefit to another customer than the benefit which is actually due to that customer - This Court is also of the prima facie view that the post-sale discount has not been granted on account of GST rate reduction and therefore, does not qualify as commensurate reduction in prices as required under Section 171 of the Act. Keeping in view the aforesaid as well as the orders passed by this Court in M/S. SAMSONITE SOUTH ASIA PVT. LTD. VERSUS UNION OF INDIA & ORS. [2020 (10) TMI 1031 - DELHI HIGH COURT], this Court directs the petitioner to deposit the principal profiteered amount after deducting the GST imposed on the net profiteered amount (which has already been deposited by the petitioner with the Department) in six equated instalments commencing 10th October, 2022. The interest amount directed to be paid by the respondents as well as the penalty proceedings and further investigation by NAA in respect of other products sold by the petitioner are stayed till further orders. Application disposed off.
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