TaxTMI 
TaxTMI 
2022 (10) TMI 312
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....of Articles 14, 19(1)(g), 265 & 300A of the Constitution of India. 2. Learned senior counsel for the petitioner submitted that the National Anti-Profiteering Authority (NAA) has no suo moto powers and therefore, the application filed by the Secretary, NAA, to the Standing Committee seeking initiation of proceedings under Section 171, is not a valid initiation of proceedings against the petitioner for examining whether there is any profiteering or not. 3. He contended that NAA is not netting of the benefit of rate reduction extended in some products as against those where the petitioner has not extended the benefit of rate reduction qua the subject products, by way of commensurate reduction in prices, and therefore, while it is being punished for being a 'bad boy', it is not being rewarded for being a 'good boy'. 4. He stated that even though in some products they have not been able to grant commensurate reduction in prices, yet they have tried to pass on the benefit by way of increase in grammage of the product. 5. He also stated that petitioner has given post sale discount (Ex.GST) to the tune of Rs.73.59 crores, and therefore, this amount should be reduced from the total prof....
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....as suo moto powers to initiate proceedings under Section 171(2) read with Rules thereunder. He submitted that the language of Rule 127 of the CGST indicates that duties of the NAA are broad enough to confer suo moto powers on the NAA:- 127. Duties of the Authority.- It shall be the duty of the Authority, - ... (ii) to identify the registered person who has not passed on the benefit of reduction in the rate of tax on supply of goods or services or the benefit of input tax credit to the recipient by way of commensurate reduction in prices; (iii) to order, (a) Reduction in prices; (b) Return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest at the rate of eighteen per cent from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount not returned, as the case may be, in case the eligible person does not claim return of the amount or is not identifiable, and depositing the same in the Fund referred to in Section 57; (c) Imposition of penalty as specified in the Act; and (d) Cancellation of registration under the Act. 9. He stated that....
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....bjective of both the Central and State Governments to provide the benefit of rate reduction to the ordinary customers by sacrificing their tax revenue. He contended that the petitioner was legally not required to collect the excess GST and therefore, he has not only violated the provisions of the CGST/SGST Acts, 2017, but has also acted in contravention of the provisions of Section 171(1) of the above Acts as he has denied the benefit of tax reduction to the ordinary buyers by charging excess GST. He stated that had the supplier not charged the excess GST, the customers would have paid less price while purchasing goods from the petitioner and hence the above amount has rightly been included in the profiteered amount as it denotes the amount of benefit denied by the above petitioner. He emphasised that price includes GST also. Thus, according to him, the profiteered amount cannot be paid from the GST deposited in the amount of the Central and the State Governments by the petitioner as the above amount is required to be deposited in the CWFs as per the provisions of Rule 133(3)(a) of the CGST Rules, 2017 along with the interest. He stated that even the DGAP had observed that: (i) t....
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.... other person' to make such an application. Also, in the case of Patanjali Ayurveda Ltd. vs. Union of India & Ors. W.P.(C) 4375/2020, the issue of suo moto powers of NAA was raised, but even Patanjali was directed to deposit the entire profiteered sum. 15. 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. 16. 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. 17. The 35 Excel sheets placed on record qua customs duty do not have any heading of bills of entry number, date, value, duty, description of goods, etc. In addition, it is not clear as to whether the imported goods were raw material or finished ....