GST NAA finds McDonald's franchisee Hardcastle Restaurants guilty of profiteering Rs 7.49 cr

Hardcastle Restaurants was operating quick service restaurants under the brand name McDonald's in the Western and Southern regions of India.

Press Trust of India November 22, 2018 15:10:23 IST
GST NAA finds McDonald's franchisee Hardcastle Restaurants guilty of profiteering Rs 7.49 cr

Mumbai: The anti-profiteering authority NAA has found Hardcastle Restaurants, a franchisee of fast food chain McDonald's, guilty of not passing on GST rate cut benefits of over Rs 7.49 crore to consumers.

Hardcastle Restaurants was operating quick service restaurants under the brand name McDonald's in the Western and Southern regions of India.

Complaints were filed against the restaurant accusing it of keeping the prices of the products same despite a reduction in the GST rate from 18 percent to 5 percent with effect from 15 November, 2017.

The Directorate General of Anti-Profiteering (DGAP) in the course of investigation has found that the restaurant has not passed over Rs 7.49 crore worth benefit due to reduction in the rate of tax as also the benefit of input tax credit (ITC) availed by the restaurant.

GST NAA finds McDonalds franchisee Hardcastle Restaurants guilty of profiteering Rs 749 cr

Representative image. Reuters.

The amount includes the extra Goods and Services Tax (GST) which Hardcastle Restaurants "forced the customers to pay due to wrong increase in basic prices, otherwise the prices to be paid should have further got reduced by the amount of the GST illegally charged...," the NAA said.

The National Anti-Profiteering Authority (NAA), in its order, has held that Hardcastle Restaurants had resorted to profiteering by charging more price.

The NAA asked Hardcastle Restaurants to reduce the prices by way of commensurate reduction, keeping in view the reduced rate of tax and the benefit of ITC which has been availed.

Also since the complainants were not identifiable, the NAA asked the restaurant to deposit over Rs 7.49 crore in the consumer welfare fund, along with 18 percent interest, within a period of three months.

The NAA has also issued a show-cause notice to Hardcastle Restaurants to explain why penalty should not be imposed.

Updated Date:

Subscribe to Moneycontrol Pro at ₹499 for the first year. Use code PRO499. Limited period offer. *T&C apply

also read

Sensex sheds 379 pts, Nifty below 15,200; ONGC, other gas stocks rally to 52-week high
Business

Sensex sheds 379 pts, Nifty below 15,200; ONGC, other gas stocks rally to 52-week high

While ONGC was the top gainer on BSE Sensex, the S&P BSE Oil and Gas index ended 632.03 points higher or 4.22 percent up at 15,609.10, a day after govt reaffirmed its commitment to bring natural gas under GST

GST collections cross Rs 1 lakh crore for fifth straight month, rise 7% to Rs 1.13 lakh crore in February
India

GST collections cross Rs 1 lakh crore for fifth straight month, rise 7% to Rs 1.13 lakh crore in February

The Union Finance Ministry said that the GST numbers 'clearly' indicate economic recovery, and the impact of various measures taken by tax administration to improve compliance

Centre released Rs 1 lakh crore GST compensation to states since Oct 2020, says Finance Ministry
India

Centre released Rs 1 lakh crore GST compensation to states since Oct 2020, says Finance Ministry

The Centre had set up a special borrowing window in October 2020 to meet the estimated shortfall of Rs 1.10 lakh crore in revenue arising on account of implementation of GST