The Goods and Services Tax (GST) has been a hot topic of discussion especially after it was implemented on July 1, 2017. While the different GST slabs have left many unhappy, some praised the government for bringing in such a revolutionary act in the Indian tax regime.
The implementation of GST came as a bad news for consumers who regularly go out in restaurants for eating out. The additional 18 per cent that was loaded on to the bills proved to be a burden.
After taking a good look at common man’s concerns over higher GST rates, in November 2017 the GST council decided to reduce the restaurant GST rate from 18 per cent to 5 per cent.
Under this, all restaurants other than those that are located in hotels, now charge 5 per cent GST as compared to 18 per cent GST (on AC restaurants) and 12 per cent (on non-AC restaurants) earlier.
While many appreciated government’s consideration, there were few who tried to take advantage of the change and still charged people more “tax” under the name of GST.
One such company that allegedly took advantage of people was Jubilant FoodWorks, who have now been served a notice by the government for profiteering by the Directorate General of Safeguards (DGS).
They have been accused of not passing the benefit of GST rate cut to its customers at Domino’s Pizza outlets.
The issue has now been referred to DGS by a standing committee which is now asking Jubilant whether they transferred the benefit of revised GST to the customers or not.
According to the PTI, the complaint was filed against Jubilant by two consumers who alleged that Domino’s Pizza was overcharging them even after the GST rate cut.
One must note that under the GST system, the anti-profiteering mechanism takes complaints at a local level which is first sent to the “screening committee” for state-level complaints while “standing committee” looks into the complaints of national level.
Both the complaints were sent directly to the “standing committee”.
Looking at the fact that this a national level complaint, the PTI tried to contact Jubilant FoodWorks, who in an email replied.
“We are in a silent period now, we would not be (able) to participate in any story.”
According to reports, Jubilant FoodWorks has replied to the notice in its defence and the DGS is now analysing the response.
DGS has set 3 months deadline to complete the investigation however, they may ask for an extension of another 3 months if required.
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