National Anti-profiteering authority under GST

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Gujarat Global News Network, New Delhi

The Union Cabinet on Thursday approved establishing the National Anti-profiteering Authority (NAA) under the Goods and Service Tax (GST) to ensure that benefit of the reduction in prices under the uniform tax regime reaches the consumers. The Cabinet consented to creating positions of Chairman and technical members of the authority which would lead to immediate establishment of the apex body.

The NAA will be headed by a senior Secretary-level official of the Central government, with four technical members from either the Centre or the states. This is the second major GST-related decision taken by the government within a week. On November 10, the GST Council relocated 178 items from the higher 28 per cent tax slab to lower tax slabs. This was the highest number of items getting a tax rate reduction in one go since GST was rolled out.

“The ‘anti-profiteering’ measures enshrined in the GST law provide an institutional mechanism to ensure that the full benefits of input tax credits and reduced GST rates on supply of goods or services flow to the consumers. This institutional framework comprises the NAA, a Standing Committee, Screening Committees in every State and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC),” according to an official statement.

Affected consumers who feel the benefit of commensurate reduction in prices is not being passed on when they purchase any goods or services may apply for relief to the Screening Committee in the particular State. However, in case the incident of profiteering relates to an item of mass impact with ‘All India’ ramification, the application may be directly made to the Standing Committee. After forming a prima facie view that there is an element of profiteering, the Standing Committee shall refer the matter for detailed investigation to the Director General of Safeguards, CBEC, which shall report its findings to the NAA,” the statement said on the working of the NAA.

“In the event the NAA confirms there is a necessity to apply anti-profiteering measures, it has the authority to order the supplier / business concerned to reduce its prices or return the undue benefit availed by it along with interest to the recipient of the goods or services. If the undue benefit cannot be passed on to the recipient, it can be ordered to be deposited in the Consumer Welfare Fund. In extreme cases, the NAA can impose a penalty on the defaulting business entity and even order the cancellation of its registration under GST.”

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