In the next three months, the National Anti-profiteering Authority (NAA) is expected to issue a wave of orders, in line with the Centre’s drive to boost Goods and Services Tax (GST) compliance. A person with direct knowledge of the matter, requesting anonymity, said that about 40 orders are expected to be issued soon on complaints against entities in the real estate, cinema industries, and consumer goods.
The firms that will be facing investigations include some of the leading suppliers of electronics and television makers, ayurvedic products, luggage and travel accessories makers, hygiene and home product firms, and two leading multiplex chains. The move comes in midst of concern among policymakers that businesses have pocketed part of the ₹1 Trillion worth of GST rate cuts that were to benefit end consumers and thus help to stimulate demand in the economy.
In the past, almost 60% of the cases investigated by the Directorate General of Anti-Profiteering (DGAP) have been confirmed to be profiteering behaviour by businesses. Since coming into force in November 2017, the NAA has issued orders on more than 100 cases. Such orders have resulted in businesses depositing about ₹600 Crore in the profiteered amount to a consumer welfare fund managed by the consumer affairs ministry.
Authorities are also expected to reach out to consumers and educate them of their rights and remedies. For this, the government has decided to direct erring companies to deposit the profiteered amounts in a separate fund which will be used for GST-related purposes. Although some of the large brands pass on the GST rate cut benefits, several others, especially the mid-sized businesses, are yet to revise the maximum retail price downwards. In fact, many citizens believe they are deprived of the benefits of such tax cuts.