The National Anti-Profiteering Authority (NAA), has finds M/s Prathima Multiplex Pvt. Ltd. guilty of anti-profiteering since benefit of additional ITC available after introduction of GST on movie tickets not passed to the purchaser.
An application was filed against the respondent M/s Lodha Developers Ltd alleging that the respondent had not passed on the benefit of additional ITC available after the introduction of GST on services by way of admission to exhibition to cinematograph films. The applicant, submitted that the Central and the State Governments had reduced the rates of GST on “services by way of admission to exhibition to cinematograph films where the price of admission tickets was above one hundred rupees” from 28% to 18%, but the benefit of which was not passed on to the recipients by the respondent as per the provisions of section 171 of CGST Act, 2017.
The respondent contended that it would cause double jeopardy to the supplier, that price is not increasing for tax increase and for tax decrease anti-profiteering was applied and the legal revenue of the supplier was confiscated. It was a clear violation of Article 19(1)(g), 300A, 265, 246 of the Constitution of India.
The Authority observed that the respondent profiteered by way of increasing the base prices of the tickets by not reducing the selling price of the tickets commensurately, despite the rate reduction in GST rate. The base price of the admission tickets was indeed increased, as a result of which the benefit of reduction in GST rate from 28% to 18% and 18% to 12%, was not passed on to the recipients by way of reduction in prices charged. The total amount of profiteering covering the disputed period was 42,60,104.
The Coram of Mr. Amand Shah, Chairman, Mr. Pramod Kumar Singh, Technical Member and Mr. Hitesh Shah Technical Member has directed the respondent to reduce the price of his tickets, keeping in view the reduction in the rate of tax so that the benefit is passed on to the recipients. The respondent is further directed to deposit the profiteered amount of Rs. 42,60, 104 along with the interest.
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