NAA dismisses Profiteering Complaint against PEPS Mattress [Read Order]

The National Anti-Profiteering Authority has dismissed a profiteering complaint against Peps Industries Private Limited.

The allegation of profiteering by the Respondent on the supply of Peps Spring Koil Bornell Normal Maroon 75x60x6″ Mattress, by not passing on the benefit of reduction in the rate of tax at the time of implementation of GST w.e.f 01.07.2017. Thus it was alleged that the Respondent had indulged in profiteering in contravention of the provisions of Section 171 of CGST Act, 2017.

Accordingly, the Kerala State Screening Committee had relied on four invoices issued by the Respondent, two invoices were dated 30.06.2017 & 15.06.2017 (Pre-GST) and two invoices were dated 21.07.2017 & 09.08.2017 (Post-GST).

After scrutiny of the above four invoices issued by the Respondent, the DGAP has intimated that there was an increase in the rate of tax on the product “Peps Spring Koil Bornell Normal Maroon 75X60X6″ Mattress” from 14.5% (2%+12.5%) (wrongly shown as 14.75% in the Report) ) in the pre-GST era to 28% in the post-GST era.

The NAA bench observed that, “the rate of tax applicable to the product had increased from 14.5% (12.5% Excise Duty + 2% CST) in pre-GST era to 28% in the post-GST regime. Consequently, the DGAP has stated that as there was no reduction in the rate of tax on the product in the post-GST era as compared to the pre-GST era, the provisions of Section 171 of the CGST Act, 2017 were not contravened and hence the allegation of profiteering by the Respondent was not established”.

The bench also said that, “We have carefully examined the report of the DGAP and the documents placed on record and find that the only issue that need to be dwelled upon in as to whether there is a case of reduction in the rate of tax and whether the provision of section 171 of CGST Act, 2017 are attracted in the case. we do not find any merit in the application filed by the above Applicant and accordingly the same is dismissed”.