Hindustan Unilever Found Guilty Of Rs 383 Crore Profiteering For Not Passing On GST Rate-Cut Benefits To Customers

National Anti-Profiteering Authority (NAA) has stated that Hindustan Unilever Limited (HUL) did not pass on GST rate cut benefits of Rs 383 crore to its customers, reports Press Trust of India.

NAA an apex agency in India works to “ensure that the benefits of the reduction is GST rates on goods and services made by GST Council and proportional change in the Input tax credit is passed on to the ultimate consumers.”

HUL the largest FMCG company in India involved in a host of categories in home care, personal care and foods. Though the GST Council had reduced the tax rates on various FMCG products from 28 to 18 per cent, the company still continued to charge the same maximum retail prices (MRP) the report claims.

“He (HUL) has acted in conscious disregard of the obligation which was cast upon him to pass on the benefit of GST rate reductions. Instead he had deliberately increased the base prices by enhancing them equivalent to the amount of GST rate reductions in order to keep the old MRPs in place or not reduced them proportionately to the benefit of tax reductions..,” said the agency.

As per the GST framework, a company is required to transfer 50 per cent of the excessive profits to the central Consumer Welfare Fund (CWF) and the remaining to the CWFs of the respective states in which the products are sold.