TaxTMI 
TaxTMI 
2022 (5) TMI 842
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....as reported that Applicant No. 1 had alleged that the Respondent did not pass on the benefit of reduction in the GST rate on "Services by way of admission to exhibition of cinematograph films" which were reduced w.e.f. 01.01.2019, vide Notification No. 27/2018- Central Tax (Rate) dated 31.12.2018 by way of commensurate reduction in price, in terms of Section 171 of the CGST Act, 2017 and instead, increased the base price to maintain the same cum tax selling price of the admission tickets. Accordingly, it was decided to initiate an investigation and collect evidence necessary to determine whether the benefit of GST rate reduction w.e.f. 01.01.2019, had been passed on by the Respondent to the recipients by way of commensurate reduction in price, in terms of Section 171 of the CGST Act, 2017. 3. The DGAP has stated that the aforesaid application was examined by the Standing Committee on Anti-profiteering, in its meeting, the minutes of which were received in the DGAP on 06.05.2020, whereby it was decided to forward the same to the DGAP to conduct a detailed investigation in the matter. Accordingly, it was decided to initiate an investigation and collect evidence necessary to determ....
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....F) and Annual Commercial License Fee (ACLF) on yearly basis and in advance towards the licensing of the land. b) The Respondent's cinema screens were at only one place of Karimnagar, Telangana. There were no branches at any other place. c) The price of the cinema screens was decided by the Government of Telangana from time to time. The price fixed only had to be collected by the cinema screen owner and no other separate charges were allowed or permitted. Further, all the taxes calculated on the price were as per the proportion of taxes from time to time and had to be paid. Tax was arrived as prescribed under the relevant Act. In the case of GST, tax was calculated in the proportion of 18/118 or 28/128, as the case might be prescribed under Rule 35 of the CGST Rules, 2017. The price fixed by the Government was "Fixed amount" and did not have any break up of basic price, GST, Total etc. i.e. no GST was collected from customer. The Respondent had also submitted history of Prices fixed by the Government. Thus, the price was fixed by the Government of Telangana only and had to be charged irrespective of the tax rates from time to time and the increased liability wa....
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....so submitted that the price had been fixed by the State Government and was modified and fixed by Hon'ble High Court of Telangana. Thus, the price fixation could not be disputed by the DGAP or this Authority. Also, the Cinema Ticket prices fixed did not give the value of taxes included in the prices but cast the liability to pay taxes proportionately, as applicable. Hence, the invoking of Anti-profiteering was untenable, since no GST was added. i) The Respondent also submitted that the matter of profiteering was already investigated by the Jurisdictional Assessing Officer, the Deputy Commissioner (Economic Intelligence Unit), State Level Screening Committee. Visiting the Respondent with fresh notice by every authority without reference to previous proceedings was impermissible as it was clearly harassment of the Respondent and hence, the jurisdiction was ousted and the same was clearly against all the canons of equity. j) The Respondent contended that the Scheme of Anti-profiteering was defective for the following reasons: i) There was no scheme laid down in the Act as to the (a) Methodology (b) How the party could verify the calculations and defended ....
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....th Appendix-I. (k) Audited financial statements for the period ending March, 2019. (I) Notices of Jurisdictional Assessing Officer, the Deputy Commissioner (Economic Intelligence Unit), State Level Screening Committees. 9. The DGAP has also reported that the Central Government, on the recommendation of the GST Council, reduced the GST rate on "Services by way of admission to exhibition of cinematograph films where price of admission ticket is above one hundred rupees" from 28% to 18% w.e.f. 01.01.2019 and "Services by way of admission exhibition of cinematograph films where price of admission ticket is one hundred rupees or less" from 18% to 12% w.e.f. 01.01.2019 vide Notification No. 27/2018-Central Tax (Rate) dated 31.12.2018. This was a matter of fact which had not been contested by the Respondent. 10. The DGAP has reported that the reference received from the Standing Committee on Anti-profiteering, the various replies of the Respondent and the documents/evidence on record had been examined in detail. The main issue to be looked into was whether the rate of GST on the "Services by way of admission to exhibition of cinematograph films where price of admis....
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....ion in taxes. The State Government/ Police Commissioner came into picture only when the cinema management wanted to increase the price of tickets beyond the maximum rate already fixed. For example, M/s AMB Cinema LLP, Telangana was having cum tax price of Rs. 3001- for platinum seats upto 05.02.2019. On knowing about the Anti-profiteering provisions, they reduced the ticket price to Rs. 277/- after 06.02.2019 and also paid the profiteering amount of Rs. 35,66,308/- and interest of Rs. 60,049/-. 13. The DGAP has further reported that the Respondent's submissions regarding matter of profiteering investigated by various other authorities or the lack of methodology or regarding the definition of "Commensurate Reduction", were unacceptable. The GST Council, constituted under Article 279A of the Indian Constitution as a federal, constitutional body, comprising all the Finance Ministers of all the States and UTs and the Union Finance Minister, in its due wisdom had rightly not prescribed any specific guidelines/mechanism/methodology to determine profiteering in Section 171 of the CGST Act, 2017 and the Rules made thereunder as the facts of each case were different for different sec....
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.... price of admission ticket is one hundred rupees or less" from 18% to 12% w.e.f. 01.01.2019. From the sales data made available, it appeared that the Respondent increased the base price of the admission ticket when the GST rate was reduced from 28% to 18% w.e.f. 01.01.2019 in the manner illustrated in Table-A below. From the Table-A below, it was observed that the prices of two categories of tickets, including taxes, were maintained: Table-A S.No. Category Period (01.12.2018 to 31.12.2018) Period (01.01.2019 to 30.04.2020) Profiteering per unit (Excluding GST) Price of Ticket GST Rate Base Price Price of Ticket GST Rate Base Price A B C D E=C/128% F G H=F/118% I=H-E 1 Gold 150 28% 117.19 150 18% 127.12 9.93 2 Silver 130 28% 101.56 130 1 8% 110.17 8.61 17. The DGAP has further stated that from the above Table- "A" it was apparent that the Respondent had increased the base price of both the admission tickets. Therefore, in terms of Section 171 of the CGST Act, 2017, benefit of GST rate reduction from 28% to 18% in respect of "Services by way of admission to exhibiti....
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....bition of cinematography films" where price of admission ticket was one hundred rupees or less, from 18% to 12% w.e.f. 01.01.2019, appeared to be correct. From the Table 'B' above, it was quite clear that the base prices of the admission tickets was indeed increased, as a result of which the benefit of reduction in GST rate from 28% to 18% and 18% to 12% (w.e.f. 01.01.2019), was not passed on to the recipients by way of commensurate reduction in prices charged (including lower GST @ 18% & 12%). The total amount of profiteering covering the period of 01.01.2019 to 30.04.2020, was 42,60,104/-. The recipients of the services were not identifiable as no such details of the consumers had been provided. 21. The DGAP has further concluled that that Section 171 (1) of the CGST Act, 2017, requiring that any reduction in rate of tax on any supply of goods or services or the benefit of ITC shall be passed on to the recipient by way of commensurate reduction in prices", had been contravened by the Respondent in the present case. The DGAP stated that this Report was being furnished under Rule 129 (6) of the CGST Rules, 2017. 22. The Investigation Report was received by this Author....
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....der Section 76 of CGST Act 2017 than under Section171 (3) and ordered for forfeiture. ix) That the DGAP had attempted to derive a new parameter of Base Price as per his own calculations ignoring that the Statute of Section 171 of CGST Act, 2017 also required the "Price" charged, the Statutorily Fixed Price by the State Government. x) That the DGAP had failed to note that Section 171 (3) was confiscatory in nature and hence was not satisfying the Article 19 (1)(g), Article 246, Article 300A etc., and that it was not a tax within the powers of Central Government or State Government or GST Council. xi) That the DGAP had also not noted that the Cinema Screen had discharged the GST liability from its Receipts and in full xii) That the DGAP had also not noted that the Scheme or machinery provisions of Computation of Profiteering was presently at the discretion of the DGAP without any computation methodology in the CGST Act, 2017 or the CGST Rules, 2017 and by innovating "base price" and thus had been administrative in character than under any authority of law. xiii) That the DGAP had taken the conduct of M/s. AMB Cinema LLP as the Law and made....
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....t acceptance by the DGAP. xxi) That the DGAP had not properly read the applicable law, Constitutional Provisions and the Scheme of Anti-Profiteering. The DGAP's rigid approach that Price should be the same for all the period the Section 171 of CGST Act, 2017 was on statute book lead to illegal, undesirable and unintended consequences and the same were beyond the powers of the DGAP/Central Government. xxii) That whether the product was exempted or not, where the price was the same before and after reduction of the tax rate, the Case of Rahul Sharma Vs. Gyan Books would be applicable. xxiii) That there was no merit in the Orders of the DGAP holding that the Cinema Screen had Profiteered. There was no jurisdiction conferred as per the extant law in the facts of his Cinema Screen case. xxiv) That the CGST Act, 2017 under Section 171 contemplated "confiscation of the amount received and not levy of tax. xxv) That this was not a case of unjust enrichment of excess tax collected and paid less tax. xxvi) That it was also not a case of free enterprise that was free to fix the price and collect applicable taxes as an agent of the Gove....
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....fixed under the orders of the Government and legally approved by the Hon'ble High Court and that the party was following the High Court orders. Thus, it was beyond the jurisdiction of this Authority, since the company was controlled by the State Government Orders. xxxiii)That what the Cinema Screen received was the price fixed by the Government of Telangana which was a fixed sum without any break up of basic price, taxes etc. Therefore for all purposes the price of cinema ticket was (i) Gold Class - Rs.148 per ticket, and (ii) Silver Class - Rs.128 per ticket w.e.f. 13-10-2018. Rs.2 per ticket was to be added towards statutory maintenance. There was no increase of basic price from the impugned date of 01-01-2019. xxxiv)That assuming without acknowledging for a moment, GST was included in the price fixed by the Government of Telangana, the GST included would be (i) Gold Class - Rs.148 per ticket - Rs.32.81 GST, and (ii) Silver Class - Rs.128 per ticket - Rs.28.44 GST, w.e.f. 13-10-2018 at the then prevailing rate of 28%.There was no price change till date. However, the DGAP Report said that GST included in the Price was Rs.22.88 for Gold Class and Rs. 19.83 for....
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....ioner (ST)-1, Economic Intelligence Unit, (iii) office of the Commissioner (State Tax), Commercial Taxes Department, Government of Telangana, vide their Notice No. RC. No. EIU / A1 / Movie Theatres/13/2019, dated 04.11.2019, (iv) by the State Level Screening Committee vide Ref. No. C.No. IV/16/07/2019-A.P, dated 28.11.2019 and (v) by The DGAP and this Authority from 02.06.2020 till date was clearly harassment and this was clearly against all the canons of equity. xxxix) That Standard Operating Procedure for Anti Profiteering list the following three parameters for enquiry:- • Swelling up of ITC due to rate reduction. • Abrupt increase in Net Profits during rate reduction. • Enhancement of the base price immediately after announcement of GST rates. The above did not arise in their case due to rate reduction since there was no swelling up of ITC, abrupt increase in Net Profit or enhancement of the base price. That he understood base price was the price on which GST was charged. When no GST was charged/collected, the price Collected was the base price and it could not be derived by the DGAP. Rule 35 provided the mechanism for pa....
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.... where GST was paid out of receipts and not separately charged or passed was like giving an amount to a person and finding him guilty of possessing the amount. Therefore, Government could not find fault of anti-profiteering with the Company for receiving the prescribed price only and was still incurring losses. xlv) The law or administrative scheme did not say the period upto which, from the date of change in GST rate, the anti profiteering provisions should be applied since the same price could not rule during the life time of the Company or during the period Anti- Profiteering provisions were on the Statute Book. xlvi) That the anti-profiteering provisions could not be applied with short sighted approach and the whole gamut of business should be considered including the inflation and increase of expenditure. xlvii) That the company had been continuously incurring losses despite promoters pumping resources in crores of rupees free of cost. The Company had incurred a loss of Rs.25.56 Lakhs in F.Y.2017-18 and Rs.158.09 Lakhs in F.Y.2018-19. For last quarter of the F.Y.2019-20 and in 2020-21 till date the cinema screens were under lock down and repaired and....
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....ent Tax was 7% or 20% or 15% as per class of cinema notified by the Government. Further, the ticket price was the same as on 01.07.2017 also when GST applicable was 18% only in his case. Further, pre-01.01.2019, on 13.10.2018 in his case the Ticket price of Rs.148 and Rs.128 were fixed and they continued even today with so much increase in administration and running costs also. liv) That the Hon'ble High Court of Telangana approved the price subject to the condition that it was informed to State Government and Proportionate Taxes thereon were paid vide its orders in WP No.37873/2018 read with WP No.19046/2014. Iv) That there were no Government Orders issued under GST by Central Government regulating the Cinema Screen price by Central Government, since it did not have power to regulate cinema ticket prices. Ivi) That the ticket price was the base price/price and it was the same pre-01.01.2019 and post 01.01.2019.There was no clause in Government Orders that for any change in taxes the Cinema Ticket price should be increased or reduced. lvii) That penalty was prescribed under Sec.171(3A) of the CGST Act, 2017 and was introduced by Finance (No.2....
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.... and Rs. 73 per ticket for Silver Class was prevailing. lxiv) That the revision of prices was effected on 13-10-2018 after 5 years 2 months and 20 days. In the mean time, the inflation or increase in expenditure was to the account of Cinema Screen resulting in losses. The rate of inflation between 2012 to 2018 was above 40% over 2012. That while revising the Cinema Ticket prices in 2018, Government had only provided for inflation in expenditure. lxv) That Penalty was not automatic but was discretionary in nature which was to be exercised keeping in view the relevant factors and the department was required to prove mensrea, i.e., consciousness on the part of assessee to evade the obligation / liability [ Dilip N Shroff V/s. JCIT, 291 ITR 521]. Further, the conditions stated in the section should exist. lxvi) That for the aforesaid reasons, the levy of penalty was unreasonable, unjustified, impermissible, and was not to be levied. 23. Clarifications were called from the DGAP on the above submissions of the Respondent. The DGAP vide his report dated 27.01.2021 has submitted his clarifications and has stated:- a. That the Respondent's contenti....
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....gana was incorrect. Levy of GST was increased or decreased or fixed by the GST Council which was a Federal Constitutional body and all the State Governments were part of the GST Council. GST leviable on of CGST Rules, 2017 had been framed under Section 164 of the said Act which had the sanction of the Parliament and the State Legislatures. It also showed that the delegated power to the Authority given under section 171 (3) of the said Act had been duly exercised by the Central Government by formulating the Rules, on the recommendation of the GST Council. Since the functions and powers to be exercised by the Authority had been approved by competent legislatures, the same were legal and binding on the Respondent. f. That Section 171 of the CGST Act, 2017 mandated that any benefit of reduction in the rate of tax or the benefit of ITC which accrued a supplier must be passed on to the consumers as both were concessions given by the Government and the suppliers were not entitled to appropriate such benefits by increasing their profit margin at the cost of the consumers. Such benefits must go to the consumers. While arriving at the quantification, the DGAP had to adopt a mathemat....
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....ion 171 of the CGST Act read with Rule 129 of CGST Rules 2017 and there was no violation of article 19 (1) (g) of Constitution of India. i. That the Respondent's contention that the DGAP had also not noted that the Cinema Screen had discharged the GST liability from its Receipts and in frill was not acceptable. The DGAP, in para 19 and 20 of the Report dated 26.11.2020 had discussed the calculation method wherein the GST element also was discussed. Further, the Respondent's plea that being a Cinema Screen, they were mandated to sell at prices, pre-determined by the State authorities, could not discharge them from their obligation to comply with the provisions of Section 171 of CGST Act, 2017 as being a registered person in GST law, they were legally and morally liable to pass on the benefit of reduction in rate of tax to the recipients. However, in the present case, although the Central Government on the recommendation of the GST council reduced the rate of tax on various products from 28% to 18% w.e.f. 01.01.2019, the Respondent increased the base price of the cinema tickets in such a way as to make the cum tax price exactly equal to the pre-rate reduction cum tax....
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....us tax revenue made from the kitty of the Central and the State Governments were required to be passed on to the consumers / recipients ensuring that both the above benefits were passed on to the general public as per the provisions of Section 171 read with Rule 127 and 133 of the CGST Rules, 2017. The report of DGAP had restricted itself to the mandate given under Section 171 of the CGST Act, 2017, it did not interfere with the profit /loss or commercial decision of the Respondent. m. That the Respondent's contention that the Report presumed that price was a non-changing element and should remain the same so long the provisions of anti-profiteering were on statute book was incorrect. The DGAP had investigated the issue whether the benefit of the reduction in rate of taxes had been passed on to the customer or not. It was the duty of all the registered persons to pass on the benefit of reduction in tax rate to the customer by way of commensurate reduction in prices. The profiteering aspect was very much in vogue until the intended benefit by way of commensurate reduction in prices was passed on. Also, The DGAP or this Authority had not acted in any way as price control....
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....ndently and had different purpose. Further both the Act / provision did not undermine each other. The price regulation by the Telangana Government was to ensure that the ticket prices should not breach a certain threshold. The regulatory Orders nowhere restrict the Respondent to charge lesser amount than the threshold. The instance of M/s. AMB Cinema LLP was illustrated to bring home the concept of commensurate reduction in prices and it was not intended as a law. r. That the DGAP, in terms of the Rule 129 of the CGST Rules, 2017, was required to submit his findings to this Authority. It had only done his duty in investigation of the present case and submitted it's report to this Authority. Profiteering was strictly determined in terms of provisions of Section 171 of CGST Act, 2017 and the rules made thereunder. While determining profiteering the costing aspect was not taken into account. Only the benefit accrued on account of reduction in the rate of tax or benefit of ITC was the parameter on which the exercise of determination of profiteering was based. This approach of the DGAP had been consistent and the same had been upheld by this Authority. The Central Governmen....
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....on to the recipient by way of commensurate reduction in prices. Even Section 171 of the Telangana Goods and Services Act, 2017 refered to this Authority as the authority intended. The provisions of the Statute controlling the functioning of the DGAP and this Authority did not require them to refer the matter to Telangana Government at the investigation stage. In terms of Rule 133 of the CGST Rules, 2017, this Authority gave ample opportunities to the interested parties to give their views before them. 24. In response to the above clarifications of the DGAP dated 27.01.2021, the Respondent vide letters dated 15.02.2021 and 27.02.2021 has reiterated the contentions of his earlier submissions dated 5.01.2021 detailed above and added that:- i) That the DGAP presumed that the Cinema Ticket price was inclusive of GST. ii) That the DGAP applied the mathematical formula of Rule 35 of CGST Rules for Price pre and post 01.01.2019 [Ticket price X GST Rate + (100+GST Rate)] on which date the applicable GST rate was reduced from 28% to 18%. iii) That the DGAP was wrong in taking the Cinema Ticket price at (i) Gold Class-Rs.150 per ticket instead of Rs.148, and (ii)....
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....hould also fix the maximum rates of payment for admission to the different classes in the licensed premises. (b) These rates should not be increased during the currency of the license without an order in writing by the licensing authority permitting such increase. xii) That the DGAP presumed on the contrary that GST was included in the Price and that it was not paid by the Supplier from its receipts. xiii) That the presumption go to the root of the issue and was contrary to the facts of the case. xiv) That certain amount of Tax was included in the price, the natural consequence was unjust enrichment for the given reduction in tax liability amount as against tax deemed to be included in the price and could only be considered as excess collection of tax and not profiteering under any circumstances could be alleged. xv) That the long gap in revision of prices without any linkage of taxes applicable also clearly show that the price was independent and could not be changed for variation in taxes. xvi) The presumption by the DGAP that the Supplier could reduce the price was not based on the cost benefit analysis. The Supplier was not ....
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....RE RECEIPTS 1,64,23,523 37.24 2,27,14,786 36.73 1,72,02,310 38.35 C INPUT TAX CREDIT 23,84,909 5.41 41,30,424 6.68 29,56,302 6.59 The above Table clearly shows the increase in distributor share in 2019-20 to 6.36% as against the 44.94% during 2018-19 i.e. an increase of 1.42% on average Ticket price. Further, the statutory maintenance receipt had reduced to 1.36% in 2019-20 as against 1.80% in 2018 19. The GST reduced is just 1.47% in 2019-20 as against 2018-19. The input credit available has reduced by 1.47% equivalent to the reduction in GST Rate. From the above it was clear that there was no profiteering as alleged and the net increase/decrease percentage to average ticket price was as follows: S.No. Particulars % of Increase/(Decrease) 1 Average reduction in GST 1.47 2 Loss of ITC (1.27) 3 Loss due to increase in Distributor cost (1.42) 4 Loss due to reduction in Statutory maintenance (0.45) 5 Increase in net receipt towards Theatre Expenses 0.50 6 Average loss per Ticket (1.17) of Average Tic....
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....lhi, had extended the due dated from time to time vide Notifications no.s : 65/2020, 91/2020, 14/2021 & 24/2021, Central Tax Notifications, and the last date notified under latest Notification No. 24/2021 for purposes of completion of any proceeding or passing of any order or issuance of any Notice, intimation, notification, sanction or approval or such other action, by whatever name called, by any authority, commission or tribunal, by whatever name called, under the provisions of the Acts stated above, was 29.06.2021. c. That after 29.06.2021 no proceeding or order could be passed under the CGST Act, 2017 read with CGST Rules, 2017. That the passing of the order was under the prohibition of "Limitation" and hence no legally valid order could be passed after that date. Hence, the jurisdiction of this Authority, was also subject to Limitation or in other words the jurisdiction was restricted upto that date only. And, there was no jurisdiction after that date or the jurisdiction was nullified after that date. No proceedings could be taken up or no order could be passed. It was also submitted that the excercise of powers by this Authority after the limitation of period was le....
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....the subject matter could not be taken up afresh also since what could not be accomplished in the regular proceedings could not be initiated or tried to meet in fresh proceedings as the same was not provided in the law and hence illegal. h. The Respondent further prayed to communicate the orders on jurisdiction since the subject matter was legally subject to limitation of time and curtails jurisdiction of NAA. The Respondent further prayed for closure of the matter in the light of the law and facts of limitation of matter. 28. The Respondent vide his email dated 17.03.2022 and 15.04.2022 has re-iterated his submissions dated 07.03.2022 and further stated that the Respondent's participation in the hearing was without any prejudice to his rights to contest the limitation of jurisdiction to pass orders and the cessation of jurisdiction. 29. The Respondent was informed vide Order Sheet dated 14.03.2022 of this Authority that, in terms of the Hon'ble Supreme Court's directions, from time to time, in Suo Moto Writ Petition (C) no. 3/2020, the present proceedings were not barred by limitation. Therefore, the hearing in the matter was rescheduled on 27.04.2022. ....
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....). Any reduction in rate of tax on any supply of goods or services or the benefit of ITC shall be passed on to the recipient by way of commensurate reduction in prices." (2). The Central Government may, on recommendations of the Council, by notification, constitute an Authority, or empower an existing Authority constituted under any law for the time being in force, to examine whether ITC availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him. (3). The Authority referred to in sub-section (2) shall exercise such powers and discharge such functions as may be prescribed. (3A) Where the Authority referred to in sub-section (2) after holding examination as required under the said sub-section comes to the conclusion that any registered person has profiteered under sub-section (1), such person shall be liable to pay penalty equivalent to ten percent of the amount so profiteered: PROVIDED that no penalty shall be leviable if the profiteered amount is deposited within thirty days of the date of passing of the Order by the Authority. ....
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....impugned date i.e. 1.01.2019. In fact, the very gist of the complaint is that the prices of tickets were kept unchanged even after reduction in GST rates, the Respondent ought to have reduced the prices of the tickets, commensurate to the reduction of GST rate in terms of Section 171 of the CGST Act, 2017. 37. The Authority finds that, the Respondent has submitted that the DGAP failed to trace the Constitutional provisions under which the DGAP or this Authority has jurisdiction. In this regard, The Authority finds that, the GST Council has been constituted under 101^st Amendment of the constitution under Article 279A of the Constitution as a Federal, Constitutional body, comprising of the Finance Ministers of all the States and UTs and the Union Finance Minister. On the recommendation of the GST Council, this Authority has been constituted under Section 171 (2) of the CGST Act, 2017 read with Rule 122 of CGST Rules, 2017. Chapter XV of CGST Rules, 2017 have been framed under Section 164 of the said Act which has the sanction of the Parliament and the State Legislatures. Therefore, the contention raised by the Respondent is not tenable. 38. The Authority finds that, the Respon....
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....n receipt of Investigation Report from the DGAP after considering the facts of each case. 41. The Authority finds that, the Respondent has also averred that the DGAP's Report presumes that price is a non-changing element and shall remain the same as long as the provisions of anti-profiteering are on the statute book. In this regard. the Authority finds that the DGAP has investigated the issue whether the benefit of the reduction in rate of taxes has been passed on to the customer or not. It is the duty of all the registered persons to pass on the benefit of reduction in tax rate to the customer by way of commensurate reduction in prices. The profiteering aspect is very much in vogue until the intended benefit by way of commensurate reduction in prices is passed on. Also, the DGAP or this Authority has not acted in any way as price controller or regulator as it does not have legislative intent to regulate when it comes to price hike decisions. The supplier is absolutely free to exercise his right to practise any profession, or to carry on any occupation, trade or business. This Authority has only been mandated to ensure that, the benefit of reduction in rate of tax or availab....
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....st the Licensing Authorities of the State and therefore are are not applicable to the matter under consideration before this Authority i.e. Anti-profiteering and determination of the profiteered amount as well as passing the benefit of reduction in rate of tax as per Notification No. 27/2018-Central Tax (Rate) dated 31.12.2018 by the suppliers to the recipients of the service. 44. This Authority, based on the facts discussed above, finds that the Respondent has resorted to profiteering by way of either increasing the base prices of the service while maintaining the same selling prices or by way of not reducing the selling prices of the service commensurately, despite a reduction in GST rate, on "Services by way of admission to exhibition of cinematograph films where price of admission ticket is above one hundred rupees" from 28% to 18% w.e.f. 01.01.2019 upto 30.06.2019. On this account, the Respondent has realised an additional amount to the tune of Rs. 42,60,104/-from the recipients which included both the profiteered amount and GST on the said profiteered amount. Thus the profiteered amount is determined as Rs. 42,60,104/- as per the provisions of Rule 133 (1) of the CGST Rule....