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CCI set to look into GST profiteering complaints

Since the tenure of NAA ends this month, its functions will be taken over by the CCI from December 1; All reports by DGAP henceforth will be submitted to CCI for its verdict

CCI set to look into GST profiteering complaints
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CCI set to look into GST profiteering complaints

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New Delhi: From December 1, all complaints related to GST profiteering will be dealt with by India's antitrust watchdog Competition Commission of India (CCI), in place of National Anti Profiteering Authority, a government notification said.

Currently, all consumer complaints of companies not passing on GST rate cut benefits are investigated by the Directorate General of Anti-profiteering (DGAP), which then submits its report to the NAA. The NAA then gives a final ruling on such complaints. Since the tenure of NAA ends this month, its functions will be taken over by the CCI from December 1. All reports by DGAP henceforth will be submitted to CCI for its verdict.

"The central government, on the recommendations of the Goods and Services Tax Council, hereby empowers the CCI, to examine whether input tax credits 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," the Central Board of Indirect Taxes and Customs (CBIC) said in a notification dated November 23. EY Tax Partner Saurabh Agarwal said given that CCI has legal expertise in determining matters related to consumer interest and a clear appellate mechanism, there would be greater transparency in the proceedings.

"It has to be seen how CCI addresses the methodology for calculation which was absent in NAA proceedings," Agarwal said. AMRG & Associates Senior Partner Rajat Mohan said allowing CII to adjudicate GST profiteering cases will improve the quality of orders. "Transfer of all pending cases from NAA to CCI and forming a special bench for adjudication may take some time before things ease out. Post this transfer, jurisdictional high courts will also consider remanding all the writ petitions filed in profiteering cases to CCI," Mohan said.

According to Deloitte India Partner MS Mani, the industry would expect some guidelines to aid in the determination of profiteering or otherwise. "Ideally, market forces should determine pricing and recourse to CCI should be made only in very exceptional cases," Mani added. NAA was set up in November 2017 under Section 171A Goods and Services Tax (GST) law to check unfair profiteering activities by registered suppliers under GST law.

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