Skip to content

CMA Final · Indirect Tax Laws and Practice · Anti-profiteering

Under the anti-profiteering provisions of the CGST Act, 2017, a registered person who is found by the Authority to have profiteered is liable to a penalty equal to what proportion of the profiteered amount?

The penalty is ten per cent of the amount profiteered. Section 171(3A) ties the penalty to the profiteered sum determined by the Authority, not to the supplier's turnover or to a full repayment of that sum.

  1. ATen per cent of the amount so profiteeredCorrect
  2. BTwenty-five per cent of the amount so profiteered
  3. COne hundred per cent of the amount so profiteered
  4. DTen per cent of the turnover of the supplier

Explanation

Section 171(3A) provides that a registered person found to have profiteered is liable to a penalty equivalent to ten per cent of the amount profiteered. It is based on the profiteered amount, not on turnover. Hence the turnover-based option is wrong.

Did you get it right without looking?

One question tells you little. A timed set on Anti-profiteering shows your real accuracy, how long you take and where you lose marks.

Practise Anti-profiteeringFree diagnostic mock

More Anti-profiteering questions