Direct Tax Services
Select Your Location
There has been a lot of confusion in the minds of the retailers and consumers as to what will be the price of goods immediately after the implementation of GST. Will they pay the Maximum Retail Price printed on the product or the revised price if there is any change in the price of such given product? This article describes MRP Rules under GST in India.
It is not possible to change the packing of every product which shows its price overnight with the implementation of GST. This is also a point of worry for the manufacturers and distributors who hold a large amount of stocks in their storage units. Here, we will discuss about the notified MRP Rules under GST.
Table of Contents
MRP or Maximum Retail Price is labelled on all products. It is the highest price determined by the manufacturers for a specific product before sale. Retailers can never charge customers more than what is displayed as MRP. It is inclusive of all taxes.
The government has addressed all these concerns of the stakeholders and consumers, and notified MRP Rules under GST on 4th July 2017. This notification clearly states the rules to be followed in case of any changes in the price of the product.
Following MRP rules are specified under the notification:
The government is well aware of the worries of manufacturers and distributors registered under GST, who have a lot of products lying in their storage. As it will take a long period of time to clear those stocks, the government has provided them with an extension period of three months starting from GST Registration date i.e. 1st July 2017 and ending on 30th September 2017. During this period they are not required to repackage their products stating the revised MRP as packaging also constitutes to a considerable amount of the cost of the product. They can just state the revised prices on their packaging along with the old price of such product. However, this relaxation will not be available after the expiry of this starting 3 months period on 30th September 2017.
Now let us discuss what will happen if there is any non-compliance on the part of the manufacturers, packers or suppliers. Former Food and Consumer Affairs Minister Ram Vilas Paswan tweeted on the evening of 4th of July 2017 that if provisions regarding revised MRP as stated in the rules are not properly followed, then legal action will be taken against such shopkeeper. We can say that proper reflection of changes in the price is mandatory, failing which, dealers will be liable to pay penalty imposed on them by the authorities.
A consumer can file complaint in case of overcharging by a retailer. The consumer can file compliant at ministry or several anti profiteering commissions in India. This ensures that the prices of products are under check and no business makes undue gains.
The government is taking all the necessary steps to make sure that GST implementation is a smooth process. The government has formed a Central Monitoring Committee which is assigned with the task of monitoring price and supply situation post-GST implementation in the economy. This committee is required to meet every Tuesday to for relevant discussions.
Along with MRP Rules under GST, government is taking every step possible to educate the stakeholder as well as the citizens about the GST law. In this process, they are conducting one hour long GST masterclass for 6 consecutive days which will be broadcasted on Doordarshan and will be available on the internet platform as well.
It may be noted that, as per MRP Rules, in case where a retailer sells a product for an amount more than the MRP, then he shall be liable for a penalty of 1 lakh rupees or one year imprisonment. For more details on GST and related laws, contact Enterslice.
Read our article:
Simplified and New GST Returns from April 2020
Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.
Many investors use fixed deposits as their primary investment vehicle. Investors with a high-ri...
The main idea of CDS, which was initially to give banks a way to transfer credit exposure, has...
Black money has been the subject of heated political debate in India for a long time. Successiv...
The Apex Court pronounced a judgement in the case titled Tata Motors Vs The Brihan Mumbai Elect...
Since economies are moving towards digitalisation and making it feasible to conduct transaction...
The Alternative Investment Funds (AIFs) Pro-rata and Pari-Passu Rights Proposal Consultation Pa...
The Financial Action Task Force, i.e. FATF (the Force), is the global money laundering and terr...
Advance tax refers to the payment of the tax liability before the end of the relevant financia...
On 11.12.15, the Hon’ble Delhi High Court (HC) pronounced a landmark judgement in the case ti...
Money laundering can be defined as the process of illegal concealment of the origin of money ob...
Are you human?: 7 + 3 =
Easy Payment Options Available No Spam. No Sharing. 100% Confidentiality
A person who is registered under the act and has aggregate turnover during a financial year exceeding INR 2 Crores...
17 Jul, 2019
The purpose of the GST regime is to benefit both the buyer and the seller and make compliance easier for businesses...
01 Jan, 2020
Red Herring Top 100 Asia enlists outstanding entrepreneurs and promising companies. It selects the award winners from approximately 2000 privately financed companies each year in the Asia. Since 1996, Red Herring has kept tabs on these up-and-comers. Red Herring editors were among the first to recognize that companies such as Google, Facebook, Kakao, Alibaba, Twitter, Rakuten, Salesforce.com, Xiaomi and YouTube would change the way we live and work.
Researchers have found out that organization using new technologies in their accounting and tax have better productivity as compared to those using the traditional methods. Complying with the recent technological trends in the accounting industry, Enterslice was formed to focus on the emerging start up companies and bring innovation in their traditional Chartered Accountants & Legal profession services, disrupt traditional Chartered Accountants practice mechanism & Lawyers.
Stay updated with all the latest legal updates. Just enter your email address and subscribe for free!
Chat on Whatsapp
Hey I'm Suman. Let's Talk!