Anti-profit Penalty: Companies go to court against govt over due procedure
The anti-profiteering mechanism under GST was introduced by the government to make sure that companies pass on the benefits of lower tax rates to consumers.
Synopsis
The tax department had begun investigations into many cases based on complaints from consumers. In a number of cases, the investigations found that the companies had not passed on the benefits of a lower tax rate or input tax credit to consumers.
Mumbai: A group of real estate, infrastructure and FMCG companies have dragged the government to court, accusing it of not following the “due process” while carrying out anti-profiteering investigations under the goods and services tax framework.The companies claim that they have been asked to pay penalties even when the investigations were not concluded. In some cases, they were dragged into the case when it was a franchisee, not the company