Anti-Profiteering Measure :
Provision relating to anti-profiteering measure has been introduced vide section 171 of CGST Act.
The idea is that the taxable person should pass on benefit of reduction in rate of tax on any supply of goods or the benefit of input tax credit to the customer as reduction in prices – section 171(1) of CGST Act.
The Central Government may, on recommendation of GST Council by notification, constitute an Authority, or empower any existing Authority constituted under any law, to examine whether input tax credits availed by any registered person or the reduction in the tax rate actually have resulted in a commensurate reduction in the price of the said goods or services or both supplied by him – section 171(2) of CGST Act.
The Authority referred to in section 171(1) shall exercise such functions and have such powers as may be prescribed – section 171(3) of CGST Act.
Political gimmick but can be source of harassment – Though this is mainly a political gimmick, the provision can cause tremendous harassment to taxable persons as it is practically impossible to prove that the benefit of input tax credit has been passed on to customer by reducing the selling prices.
If these powers are given to lower GST authorities, the scope of harassment is tremendous.