GSTAT: Subway Franchisee Profiteered by Raising Prices to Offset ITC Loss; 18% Interest Not Retrospective

The GST Appellate Tribunal (Anti-Profiteering Division), Delhi held that a Subway franchisee engaged in profiteering by increasing the base prices of its products to neutralise the loss of Input Tax Credit after the GST rate change.

The Tribunal said the increase in price violated anti-profiteering provisions because the benefit of tax reduction was not passed on to consumers.

It also held that 18% interest cannot be applied retrospectively, noting that liability must align with the provision in force at the time of the alleged contravention.

The matter was partly allowed with directions for recomputation.

[Subway Systems India Pvt Ltd v. Director General of Anti-Profiteering]