TMI Blog2020 (2) TMI 1654X X X X Extracts X X X X X X X X Extracts X X X X ..... tion wise (or in other words supply channel wise) sales data submitted by the Respondent during the hearings before this Authority has been analysed, and that the profiteered amount may vary if the same was determined segment-wise. Without going into merits of the case and without considering the other submissions of the Respondent and the Applicant No. 1 at this stage, we find it imperative that there is need of re-computation of the profiteered amount. All other submissions of the Applicants and the Respondent will be duly considered after the final computation of the profiteered amount is done - this Authority under rule 133(4) of the CGST Rules 2017 directs the DGAP to further investigate the following issues and to furnish his Report accordingly under Rule 129 (6) of the CGST Rules, 2017. Application disposed off. - - - I.O. No. 12/2020 - Dated:- 27-2-2020 - Sh. B. N. Sharma, Chairman, Sh. J. C. Chauhan, Technical Member and Sh. Amand Shah, Technical Member None for Applicant Sh. Prakash Sinha, Company Representative, Ms. Neha Suneja, Company Representative and Ms. Archana Tayal, Chartered Accountant for the Respondent. ORDER 1. The present Report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asmeet Singh, Director of the Respondent to appear before the DGAP on 07.06.2019 and to submit the requisite details/documents. Accordingly, Sh. Jasmeet Singh, along with authorised signatory appeared before the DGAP on 07.06.2019 and submitted few requisite documents and the remaining documents were submitted subsequently. 5. The DGAP had sought extension of time for completing the investigation which was extended by this Authority vide its order dated 19.06.2019 in terms of Rule 129 (6) of the CGST Rules, 2017. The period of the investigation is from 01.01.2019 to 31.03.2019. 6. The DGAP also offered an opportunity to the Applicant No. 1 for inspection of non-confidential documents submitted by the Respondent on any working day between 19.08.2019 and 20.08.2019 vide e-mail dated 13.08.2019. However, Applicant No. 1 did not avail of the said opportunity. 7. The Respondent submitted his replies to the DGAP vide letters/emails dated 19.04.2019, 03.05.2019, 13.05.2019, 07.06.2019, 11.06.2019, 05.08.2019, 08.08.2019 and 13.08.2019. 8. Vide his above mentioned replies, the Respondent contended that the negative figures in his sales data relate to the credit notes raised by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITC. This was the legally prescribed mechanism to pass on the benefit of ITC or reduction in rate of tax to the recipients under the GST regime. 13. The DGAP has also reported that perusal of the invoices made available by the Respondent indicated that the Respondent had increased the base prices of the impugned goods when the rate of GST was reduced from 28% to 18% w.e.f. 01.01.2019. The details of the impacted product sold before and after GST rate reduction was also illustrated in the Table-A below:- 14. The DGAP, on the basis of comparison of the aforesaid pre and post-reduction GST rates and the details of outward taxable supplies (other than zero rated, nil rated and exempted supplies) of the impugned goods during the period 01.11.2018 to 01.03.2019, as furnished by the Respondent has observed that the amount of net higher sales realization due to increase in the base prices of the impacted goods, despite the reduction the GST rate from 28% to 18% or in other words, the profiteered amount came to Rs. 5,21,965/-. The profiteered amount had been computed by comparing the average of the base prices of the impugned goods sold during the period 01.11.2018 to 31.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22 23 Madhya Pradesh 5916.688 23 24 Gujarat 18332.98 24 27 Maharashtra 77746.76 25 29 Karnataka 28305.28 26 30 Goa 2089.513 27 32 Kerala 7270.249 28 33 Tamil Nadu 33756.83 29 34 Pondicherry 823.3465 30 35 Andaman Nicobar Islands 155.0828 31 36 Telangana 22463.75 32 37 Andhra Pradesh (New) 15927.93 Grand Total 521965 16. The DGAP further stated that the allegation of profiteering against the Respondent by w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ues in his submissions, viz.:- (i) The DGAP has not considered various facts prevailing in the electronic industries where prices of goods were driven by fast changing technology, demand and supply and terms of sale like cash, debit/credit card and credits. However, in this case, the Respondent supplied 26 models/SKU of power banks and base price profiteering computation has been done separately for each model/SKU. Hence, the said contention of the Respondent was not relevant. (ii) Regarding the Respondent's contention that the location of sale was also important as the price in a mall may vary than the price at warehouse, the DGAP has clarified that at time of furnishing data and records for the investigation, the Respondent had provided data for only 5 types of sale viz. Exports, Inter-state, Intra-state, Normal sale Stock transfer and that the Respondent had not submitted the data relating to the warehouse sales through mall etc. separately and thus the profiteering has been calculated on the basis of data supplied by the Respondent during the investigation. 21. In response to the above Report of the DGAP, the Respondent filed his next written submissions dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o computation of profiteering were to be finalised and the amount of profiteering, if any, was to be determined. 24. Clarification was sought from the DGAP on the Respondent's submissions dated 13.11.2019 and 19.11.2019. The DGAP, vide his supplementary Report dated 02.12.2019 has mentioned that in respect of the Respondent's submission dated 13.11.2019, the profiteering has been calculated only for those SKUs where the Respondent has increased the base prices after GST rate reduction. Further, the Respondent supplied 26 models/SKU of power banks and base prices profiteering computation has been done separately for each model/SKU. The Respondent had not submitted the information/ details of the data relating to his warehouse/office sale and mall sales etc. and at the time of the investigation and the Respondent had provided data for only 5 types of sale viz. Exports, Inter-state, Intrastate, Normal sale Stock transfer. Thus, the profiteering has been calculated on the basis of data supplied by the Respondent during the investigation. So the contention of the Respondent was not relevant. The DGAP, in respect of the Respondent's submission dated 19.11.2019, stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Respondent has been analysed, and it appeared that the profiteered amount may vary if the same is determined segment wise. 27. We have carefully considered all the Reports filed by the DGAP, submissions of the Respondent and other material placed on record and it is revealed that the Respondent did not submit the supply chain wise data to the DGAP during the period of investigation. He has also accepted it during the hearings before this Authority and stated that he had not supplied supply chain wise data. However, the Respondent vide his submissions dated 06.12.2019 has furnished the invoices of sale from different locations/segments along with detailed segment wise invoice details in excel sheets before this Authority. The DGAP, after examining the same has reported vide his supplementary Report dated 23.12.2019 that the fresh set of segment/location wise (or in other words supply channel wise) sales data submitted by the Respondent during the hearings before this Authority has been analysed, and that the profiteered amount may vary if the same was determined segment-wise. 28. In such circumstances, we are of the opinion that justice cannot be done if the aforementioned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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