The proposed anti-profiteering authority under the new goods and services tax (GST) regime will take up for scrutiny only those cases that have a mass impact, but it will not look at small cases of undue profits.
A five member National Anti-Profiteering Authority, headed by a secretary-level officer, will be set up soon to keep a tab on businesses that have not passed on to consumers the benefit of lower tax rates under the GST regime. “The authority will take up cases of mass importance. It will not look into small cases, but no monetary threshold has been fixed on cases to be picked up for scrutiny by the authority,” Adhia said.
As per the three tier structure—the GST implementation committee (GIC) will receive complaints and those which are state specific and involving smaller amounts will be transferred to the state screening committee.
Other cases will be referred to the directorate general of safeguards who will finish investigation within 3 months and send the findings to the anti-profiteering authority, which will pass an order in another three months’ time. The small cases, which are confined to one state specifically, will be referred to the state screening committee. ADG safeguards will act as secretary to the National Anti-Profiteering Authority and will coordinate between the authority and the DG safeguards office. In the three-tier structure for monitoring profiteering, the GST implementation committee, including four officers each from the center and states and one officer from the GST Council, will first receive the complaints.
Thereafter, DGS, which has the power to issue the summons, will conduct an investigation and give its findings to the authority. The anti-profiteering authority, if it finds that a company has not passed on the GST benefits, will either direct it to pass on the benefits to consumers or if the beneficiary cannot be identified will ask the company to transfer the amount to the “consumer welfare fund” within a specified timeline.
According to the anti-profiteering rules, the authority will suggest a return to the undue profit earned from not passing on the reduction in the incidence of the tax to consumers along with an 18% interest.