GSTAT’s first anti-profiteering ruling expands probe scope, rejects cost-based defences; hospitality, retail on notice
The Principal Bench of the Goods and Services Tax Appellate Tribunal (GSTAT) has delivered its first ever anti-profiteering verdict, upholding the recovery of Rs 5.47 lakh with 18% interest from a restaurant franchise for failing to pass on a GST rate cut from 18% to 5% in November 2017.
The ruling in DGAP vs Urban Essence, issued on August 5 by GSTAT President Dr. Sanjaya Kumar Mishra, affirms that anti-profiteering investigations can cover all products sold under a GST registration and not just the item mentioned in the original complaint and rejects cost escalation as a valid defence.
The Tribunal directed that the profiteered amount, along with interest, be deposited into the Consumer Welfare Fund, ensuring consumers benefit even when direct refunds are not feasible.
