National Anti-profiteering Authority (NAA)

Introduction

• National Anti-profiteering Authority (NAA) was constituted under section 171 of the Central Goods and Services Tax Act, 2017.
• NAA constituted by the Central Government to examine whether additional input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in prices to the recipients.

Composition of the Authority

• The National Anti-profiteering Authority (NAA) shall be a five member committee consisting of a Chairman and four Technical Members.
• The Additional Director General of Safeguards under the CBEC (Board) shall be the Secretary to the Authority.
• The Authority shall cease to exist after the expiry of two years from the date on which the Chairman enters upon his office unless the GST Council recommends otherwise.

Functions of the Authority

• To identify the registered person who has not passed on the benefit of reduction in the rate of tax on supply of goods or services or the benefit of input tax credit to the recipient by way of a commensurate reduction in prices.
• To order:

1. Reduction in prices.
2. Return to the recipient, an amount equivalent to the amount not passed on by way of a commensurate reduction in prices along with interest at the rate of 18 %.
3. Imposition of penalty.
4. Cancellation of registration.

• The NAA can direct any tax authority of Central, State or Union territory to monitor the implementation of the order passed by it.
• If undue benefit cannot be passed on to the customer, it will be deposited in the Consumer Welfare Fund.