New Delhi: MNCs which were pulled up for not cutting prices post GST implementation, have argued before the anti-profiteering authority that prices of some products could not be lowered as there was difficulty in adjusting them to decimal points.
The authority, in turn, has asked these MNCs why they could not adjust the quantity so that the benefit of GST rate cut could be passed on to the consumers.
The authority, sources said, asked Multinational Companies (MNCs) to follow the rules laid down in The Legal Metrology Act while fixing the price to the nearest decimal point.
Some companies have argued that they reduced the prices of large packets but could not do the same for smaller packets and sachets, in some cases, as the quantum of price reduction was very low in decimal points, sources told PTI.
In a lot of cases the reasoning given by the MNCs for not passing on the rate cut benefit did not cut ice with the authority, which is looking into such cases post the investigation submitted by the Directorate General of Anti Profiteering.
According to sources, some companies have said they had reduced prices of certain brands of the same commodity but did not cut price for other brands.
It was also pointed out by some companies that they have reduced the prices of certain brands of the same product, but failed to explain why the prices were not reduced on other brands.
Section 171 of the Central GST Act says that any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices.
To ensure that the prices are reduced, the anti-profiteering authority was set up in November last. GST was rolled out on July 1, 2017.
The Council, has in the last one year reduced tax rates in 384 commodities.
