[ By Bobby Anthony ]The Delhi High Court has stayed the National Anti-profiteering Authority’s (NAA) order against Nestlé once again, in order to recover Rs 73 crore by March 2020 for not passing on the benefits of the goods and services tax (GST) rate cut to consumers.The stay has been granted on grounds that Nestlé had already paid Rs 16.58 crore of the total demand of Rs 89.73 crore.It...
The Delhi High Court has stayed the National Anti-profiteering Authority’s (NAA) order against Nestlé once again, in order to recover Rs 73 crore by March 2020 for not passing on the benefits of the goods and services tax (GST) rate cut to consumers.
The stay has been granted on grounds that Nestlé had already paid Rs 16.58 crore of the total demand of Rs 89.73 crore.
It may be recalled that in December 2019, the NAA had upheld profiteering allegations on the grounds that Nestlé had not passed on the benefits of reduced GST to customers.
Later, Nestlé went on to challenge the order on the ground that the NAA had passed the same suo motu and not on the basis of any written complaint, which was impermissible.
Nestlé also argued that while the matter was heard by four members, the NAA order was signed by only three members and passed beyond the mandatory period of three months.
The NAA noted that the methodology adopted by Nestlé to pass on GST rate cut was “illogical, arbitrary, and illegal, which has resulted in unfairness and inequality while passing on the benefit of tax reduction”.
As per GST anti-profiteering rules, benefits of input tax credit should have been passed on to the recipient by way of commensurate reduction in prices.
The case is scheduled to come up for hearing on May 20.