The GST officials are working on a mechanism to prompt taxmen to initiate profiteering complaints which could be taken up for further investigation by the Directorate General of Anti-Profiteering. Currently only consumers can file complaints against businesses for not passing the benefits of reduction of rates of Goods and Services Tax(GST) on various products.
Under the Standard Operating Procedure(SOP) being worked out by the GST Officials, the Central and the state government officers will be encouraged to take up Suo moto the issue of profiteering by businesses, sources said. Once the tax officers find that GST benefits have not been passed on to the consumers, they will refer the case for further investigation to the Directorate General of Anti-Profiteering (DGAP).
As per the procedure, the DGAP submits its investigation report to the National Anti-Profiteering Authority (NAA), which decide on the final quantum of profiteering and the monetary penalty.
In 2018, the NAA received 80 investigation reports from the DGAP and issued final orders in 29 cases. Of this, 9 businesses were found to have not passed on benefits of rate cuts of about Rs 559.90 crore to consumers.
So far in 2019, the NAA has passed orders in 3 cases.
The proposed mechanism will also act as a deterrent for businesses who show reluctance in passing on GST benefits.
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