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J26 GST LAW TIMES [ Vol. 40
of Input Tax Credit shall be passed on to the recipient by way of commensurate
reduction in prices. Those will be served to the respondent - the Central Gov-
ernment.
A list of common questions around the anti-profiteering issue need to be
filed by the petitioners.
The Bench orally indicated it would first decide the common question of
law on the constitutional issues and on the interpretation of the anti-profiteering
provisions by way of judgment. Thereafter, if the need arose, it would decide the
factual issues in each case individually. The matter has been adjourned to No-
vember 3.
These companies have challenged the constitutional validity of the anti-
profiteering provision in the CGST Act and the anti-profiteering rules related to
the methodology and procedure for determination whether reduction in the GST
rate or the benefit of input tax credit has been passed on by the registered person
to the recipient by way of commensurate reduction in prices. Companies have
argued these are in violation of Articles 14, 19(1)(g), 265, and 300A of the Consti-
tution of India.
Harpreet Singh, Partner, KPMG, said, “This is one of the most keenly ob-
served proceedings. The outcome of this case could determine the way forward
for the industry, in terms of adherence to anti-profiteering provisions, and in a
way impact their proposed marketing strategy.”
“While the Court would initially decide the aspect of the constitutional
validity of Section 171 of the CGST Act, the determination of the quantum of
profiteering cannot be ignored and hence, would have to be argued for each spe-
cific petition. These facts in each petition would also play an important role to
decide the actual profiteering, if at all,” said Abhishek A. Rastogi, Partner at
Khaitan & Co., who is arguing the seven petitions on anti-profiteering.
[Source : Business Standard, New Delhi, dated 25-8-2020]

States for GST dispute resolution system

States will pitch for putting in place a dispute resolution mechanism in
the absence of consensus over the compensation payout by the Centre at the
meeting of the Goods and Services Tax (GST) Council on 27-8-2020.
In what is expected to be a stormy meeting between the Centre and
States, the latter will press for a vice-chairman post in the Council, besides de-
manding full and timely compensation as “guaranteed by the Constitution of
India”.
No compensation has been paid to States for the current fiscal, despite
four months’ compensation falling due under the bi-monthly payment mecha-
nism.
While the Centre will likely ask States to borrow to make up for the
shortfall in Compensation Cess collection, States want either the Centre or the
GST Council to borrow.
In the first four months of this fiscal, ` 21,940 crore has been collected as
Compensation Cess, which is 33 per cent lower than the previous year. Increas-
ing the cess period by another two to five years, widening coverage of Compen-
sation Cess to include more goods and services, hiking cess on existing items and
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