Anti- Profiteering in GST Common FAQ by NAA

What is an ‘Anti-profiteering’ activity?

Any reduction in rate of GST tax on any supply of goods or services or the benefit of input tax credit should have been passed on to the recipient by way of commensurate reduction in prices. The wilful action of not changing the final price of the good or service by various means, despite the reduction in the rate of the tax for that particular good or service, is amount to “profiteering”.

How is the anti-profiteering mechanism under CGST act?

CGST mandate a 3-tier structure for investigation and adjudication of the complaints regarding profiteering.

  1. a) National Anti-profiteering
  2. b) Authority Directorate General of Safeguards
  3. c) State-level screening committees and standing committee

How does the screening committee and Standing committee work?

GST council may constitute a standing committee, having members from both state and central government.

Every state shall constitute one state-level screening committee. It will have one member from state government and one-member form central government as nominated by respective appropriate authority. The complains or issues of local nature will be first examined by the screening committee.

State-level screening and standing committee will examine the complaint and determine the prime facie evidence to support the validity of the complaint. If any committee satisfies that supplier has contravened the section 171 of CGST Act, the case shall be transferred to DG Safeguards for further investigation.

The committees shall complete the investigation within a period of a month from the date of the receipt of the application.

What is the role of DG Safeguards in the Anti-profiteering mechanism?

DG safeguards is the main investigation arm in the anti-profiteering mechanism. It can summon the interested parties or make inquiry or call the relevant documents. It can seek help from technical experts in the due course of investigation.

DG safeguards shall complete the investigation within a period of three-months from the date of receipt of the report from either screening or standing committee. The period can be extended for another three months.

Who can file the complaint against profiteering?

Any consumer or organisation experiencing the non-reduction in the price of the goods or service despite reduction in the rate of GST can file the complaint with proper evidences.

Any  supplier, trader, wholesaler or retailer, who could not get benefit of input tax credit on account of reduction in the rate of GST, can also file the complaint with proper evidences.

How can I file complaint against profiteering?

A person can download the complaint from the website dgsafeguards@gov.in and post the filled complaint at,

Directorate General of Safeguards,

Dept. of Revenue, Ministry of Finance,

2nd floor,

Bhai Veer singh sahitya sadan,

Bhai Veer singh marg,

Gole market, New Delhi -110 001.

Email-id: dgsafeguards@nic.in

(online complaint facility is under progress)

How can I know the status of my complaint against profiteering?

Complainant can contact at:

Directorate General of Safeguards,

Dept. of Revenue, Ministry of Finance,

2nd floor,

Bhai Veer singh sahitya sadan,

Bhai Veer singh marg,

Gole market, New Delhi -110 001.

Contact no.: 011- 2374 1544, 011- 2374 1542,

Email-id: dgsafeguards@nic.in

(online complaint-tracking facility is under progress)

Will I be eligible to recover the amount on account of my complaint against profiteering?

National Anti-profiteering has power (under Rule No. 127 of CGST Rules 2018) to compel the defaulter to 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 percent from the date of collection of higher amount till the date of return of such amount.

Only the recipient is the eligible to receive the amount.

Will NAA provide opportunity of personal hearing to whom complaint is been made?

Yes. Under Rule No.133 (2) of CGST Rules 2018, an opportunity of hearing shall be granted to the interested parties by the Authority where any request is received in writing from such interested parties.

What is the consumer welfare fund?

A separate fund has been created by the central government under to section 57 and 58 of the CGST act, which would be utilised for the welfare of the consumers in the country.

When the recovery of the amount including interest not returned in case the eligible person does not claim return of the amount or the recipient is not identifiable, in such conditions, the recovered amount is deposited in the consumer welfare fund.

Source: National Anti-Profiteering Authority Web

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