NEW DELHI: The Union Cabinet on Thursday put its seal on the creation of the National Anti-profiteering Authority (NAA), an apex body to check profiteering under GST regime.
The “anti-profiteering” measures enshrined in the GST law provide an institutional mechanism to ensure that the full benefits of input tax credits and reduced GST rates on supply of goods or services flow to the consumers.
The Cabinet approval came at a meeting chaired by Prime Minister Narendra Modi, Minister for Electronic, IT and Law and Justice Ravi Shankar Prasad said here while briefing media about the Cabinet decisions.
Sharp reduction in the GST rates of a large number of items of mass consumption came into effect from the midnight of November 14.
The GST rate has been slashed from 28% to 18% on goods falling under 178 headings. There are now only 50 items which attract the GST rate of 28%. Likewise, a large number of items have witnessed a reduction in GST rates from 18% to 12% and so on and some goods have been completely exempt from the tax.
The institutional framework mandated under the GST law to check profiteering comprises the NAA, a Standing Committee, Screening Committees in every State and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC).
Affected consumers who feel the benefit of reduction in prices is not being passed on when they purchase any goods or services may apply for relief to the Screening Committee in the state concerned.
However, in case profiteering relates to an item of mass impact with ‘All India’ ramification, the application may be directly made to the Standing Committee.
After forming a prima facie view that there is an element of profiteering, the Standing Committee would refer the matter for detailed investigation to the Director General of Safeguards, CBEC, which will report its findings to the NAA.
In the event the NAA confirms there is a necessity to apply anti-profiteering measures, it has the authority to order the supplier/business concerned to reduce its prices or return the undue benefit availed by it along with interest to the recipient of the goods or services.
If the undue benefit cannot be passed on to the recipient, it can be ordered to be deposited in the Consumer Welfare Fund. In extreme cases, the NAA can impose a penalty on the defaulting business entity and even order the cancellation of its registration under GST.
The constitution of the NAA shall bolster confidence of consumers as they reap the benefits of the recent reduction in GST rates, in particular, and of GST, in general, Mr Prasad said. (AGENCIES)
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