Delhi HC hears 37 anti-profiteering pleas

The Delhi High Court on 24 August, heard 37 petitions in relation to Goods and Services Tax (GST) and anti-profiteering writ petitions which included petitions filed by Johnson & Johnson, Reckitt Benckiser, Hindustan Unilever, Patanjali Ayurved, Philips India, Jubilant Foodworks, and IFB. It also served notice to the Attorney General of India over the constitutional validity of the profiteering provision.

These companies have challenged the constitutional validity of the anti-profiteering provision in the Central GST (CGST) Act and the anti-profiteering rules related to the methodology and procedure for determination whether reduction in the GST rate or the benefit of input tax credit has been passed on by the registered person to the recipient by way of commensurate reduction in prices. The companies have argued that these are in violation of Articles 14, 19(1)(g) , 265, and 300A of the Constitution of India.

The High Court Bench directed the petitioners to jointly finalise questions on the constitutional validity of Section 171 of the CGST Act, which states any reduction in the rate of tax on the supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices. Those questions will be posed to the Central Government which is the respondent.

The petitioners will now have to come up with a list of common questions around the anti-profiteering issue.

The Bench orally indicated it would first decide on the isues of common questions of law on the constitutional issues and on the interpretation of the anti-profiteering provisions by way of judgment. Thereafter, if required, it would decide the factual issues in each case individually.

The matter has been adjourned to November 3.