Anti-profiteering under GST not attracted where base price stayed constant and selling price fell after the rate cut.

Anti-profiteering provisions were examined in the context of a GST rate reduction on specified tiles. The record indicated that the base price remained unchanged before and after the rate cut from 28% to 18%, while the selling price was reduced after the tax change. On those facts, the benefit of the lower tax rate was treated as having been passed on to the recipient, so the allegation of profiteering was not sustainable and Section 171(1) was not violated.

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Issues: Whether the respondent contravened the anti-profiteering provisions by failing to pass on the benefit of reduction in GST rate on the specified tiles.

Analysis: The invoices relied upon showed that the base price of the products remained unchanged before and after the rate reduction from 28% to 18% under the relevant notification. The record also showed that the selling price was reduced after the tax cut, indicating that the benefit of reduction in tax rate was passed on to the recipient. On these facts, the allegation of profiteering was not sustainable and the anti-profiteering provision was not attracted.

Conclusion: The respondent was held not to have contravened Section 171(1) of the Central Goods and Services Tax Act, 2017, and the allegation of profiteering was rejected.

Final Conclusion: No anti-profiteering liability was found, as the respondent had passed on the benefit of the GST rate reduction by keeping the base price constant and reducing the selling price accordingly.

Ratio Decidendi: Where the base price remains constant and the selling price is reduced following a GST rate cut, the benefit of tax reduction is treated as having been passed on and Section 171 is not violated.

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