NAA asks Patanjali Ayurved to deposit ₹75 crore ‘profiteered’ amount1 min read . Updated: 17 Mar 2020, 09:45 AM IST
- Patanjali Ayurved has been asked to deposit the amount, along with an 18% interest, within three months
- GST officials have been asked to monitor compliance of the order and file a status report
NEW DELHI: The National Anti-profiteering Authority (NAA) has asked Patanjali Ayurved Ltd. to deposit ₹75 crore the company allegedly profiteered by not passing on to consumers the benefit of a cut in Goods and Services Tax (GST) rates announced in November 2017.
As the order, available on the NAA website, Patanjali Ayurved has been asked to deposit the amount, along with an 18% interest from the date the amount was collected, in specified consumer welfare funds of central and state governments within three months.
An email sent to the company on Tuesday seeking comments remained unanswered at the time of publishing.
In addition to asking companies to deposit the allegedly profiteered amounts, the NAA also determines a penalty for the breach. The NAA order said it has issued a notice to the company asking why it should not proceed to impose a penalty. It has also ordered GST officials to monitor compliance of the order by the company and file a report.
The order said it was evident from an assessment that the company has "denied the benefit of tax reduction to consumers in contravention of the provisions of section 171 (1) of CGST Act and has profiteered" as per the explanation attached to this provision. CGST Act mandates that companies have to make an immediate commensurate reduction in price to the consumer when a tax relief in terms of rate cut or input tax credit is given. There, however, is no lock-in period for holding this reduced period.
The GST Council, on 15 November, 2017, announced a tax cut on products, including detergents, which is among the items sold by Patanjali.