A division bench of the Delhi High Court has today stayed the demand against the Hindustan Unilever Ltd (HUL) after the National Anti-profiteering Authority (NAA) passed an order against the Company for not passing GST rate cut benefit to the consumers after the large-scale cut last November.
Justice Sanjiv Khanna and Justice Anup Jairam Bhambhani were hearing a petition filed against the NAA Order. The bench today asked the HUL to pay 90 crores with the department as per the NAA Order.
Earlier, the NAA observed that Rs 383.35 crore worth “benefit has been denied” by HUL to its customers. The authority also directed HUL to reduce the prices of its products by way of commensurate reduction keeping in view the reduced rates of tax and the benefit of ITC. As per GST rules, 50 percent of the amount profiteered or Rs 191.68 crore is required to be deposited by the company in the central consumer welfare fund (CWF), while the balance amount is to be deposited in the CWF of concerned states where the company sold its products.
It was observed that, after allowing for certain deductions, the confirmed amount of tax benefit that the company has not passed on to consumers was assessed at Rs. 383 crores. NAA asked HUL to deposit Rs. 223 crore in central and state consumer welfare funds as the company had proactively deposited Rs. 160 crore with the central consumer welfare fund, set up under the anti-profiteering laws.
