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Respondent did not pass on the benefit of reduction in the GST rate in respect of “Fly Ash Blocks” from 12% to 5% w.e.f. 01.01.2019 and instead increased the unit base price which amounts to profiteering

Anti-Profiteering — The brief facts of the case are that the Applicant alleging the profiteering action by the Respondent in respect of “Fly Ash Blocks” supplied by the Respondent. The Applicant No. 1 had also alleged that the Respondent did not pass on the benefit of reduction in the GST rate from 12% to 5% w.e.f. 01.01.2019 notified vide Notification No. 24/2018- Central Tax (Rate) dated 31.12.2018 and instead increased the unit base price. Held that— perusal of the invoices made available by the Respondent indicated that the Respondent had increased the base prices of the “Fly Ash Blocks” when the rate of GST was reduced from 12% to 5% w.e.f. 01.01.2019 and on the basis of aforesaid pre and post-reduction GST rates and the details of the outward taxable supplies (other than zero rated, nil rated and exempted supplies) of the “Fly Ash Blocks” during the period from 01.01.2019 to 31.03.2019, as furnished by the Respondent, the amount of net higher sales realization due to increase in the base prices of the impacted goods, despite the reduction in the GST rate from 12% to 5% or the profiteered amount came out to be Rs. 55,60,340/-. The Respondent has denied the benefit of rate reduction of GST to his recipients in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has thus resorted to profiteering. Hence, he has committed an offence under Section 171 (3A) of the CGST Act, 2017 and therefore, he is apparently liable for imposition of penalty under the provisions of the above Section. — Apoorve Talera, Proprietor, Shree Gautam Traders, Director General of Anti-Profiteering, Central Board of Indirect Taxes & Customs Vs. Litecon Industries Pvt. Ltd. [2020] 23 TAXLOK.COM 017 (NAPA)