NAA passes order against HUL confirming Profiteering Charges : Read Order

NAA passes order against HUL confirming Profiteering Charges : Read Order National Authority of Anti-Profiteering has passes order against Hindustan Unileavers , confirming Anti Profiteering charges. The extract of Order is given Below 78. In view of the above facts the Respondent is also directed to reduce the prices of his products by way of commensurate reduction keeping in view the reduced rates of tax and the benefit of ITC. Since the Applicants had complained in general that the Respondent had failed to pass on the benefit of rate reductions, there is no specific amount to be paid to them. Therefore as per Rule 133 (3) (c) of the CGST Rules, the Authority directs the Respondent to deposit the above amounts into the concerned CWFs along with the interest @ 18% till the same is deposited with in a period of three months from the date of receipt of this order as the profiteered amount has been used by the Respondent in his business. The concerned Central and the State GST Commissioners are directed to ensure that the amount due to them is got deposited along with the interest with in the specified period under the supervision of the DGAP failing which the same shall be recovered by them as per the provisions of the CGST/SGST Acts. The action taken by them in pursuance of this order shall be reported by them to this Authority within a period of 4 months from the date of this order through the DGAP. Since the present investigation has been conducted for the period between 15.11.2017 to 28.02.2018, the DGAP is directed to conduct further investigation to ascertain whether the Respondent has passed on the benefit of tax reductions in respect of all the products being sold by him and in case it is found that he has not done so further Report shall be submitted by him quantifying the amount of profiteering. 79. From the above discussion it is clear that the Respondent has resorted to profiteering being very well aware of the law and the rules which warranted him to pass on the benefit of GST rate reductions. Further he has also consciously and illegally recovered the excess realisation which was due to his RSs as ITC and thereby denied the benefit of tax reductions to the customers. He has further acted in conscious disregard of the obligation which was cast upon him to pass on the benefit of GST rate reductions. Instead he had deliberately increased the base prices by enhancing them equivalent to the amount of GST rate reductions in order to keep the old MRPs in place or not reduced them proportionately to the benefit of tax reductions, accordingly he has committed an offence under section 122 (1) (i) of the CGST Act, 2017 by issuing incorrect invoices to his customers and thus penal provisions under the above Act are required to be invoked against him. A notice dated 29.08.2018 was issued to the Respondent to explain why penalty should not be imposed under the above provisions. The Respondent vide his reply dated 14.09.2018 has submitted that in so far as the proposal to invoke penal provisions for imposition of penalty and cancellation of registration was concerned it can be done only after the Authority determines the allegation of profiteering against him. Since the Respondent has been held guilty of profiteering and has also been found to have violated the provisions of Section 122 (1) (i) of the CGST Act, 2017 a fresh notice be issued to him asking him to explain why penalty should not be imposed on him. 80. A copy of this order be supplied to all the Applicants, the Respondent Click here to download the Order