Jubilant FoodWorks Tuesday said it is studying the order issued by the National Anti-Profiteering Authority (NAA) in detail and will be exploring all possible options for the future. The company, which is the operator of Dominos Pizza chain in India, said it has unreservedly supported the reduction of GST on restaurants to 5 percent, as it believes it to be an extremely progressive and growth-enabling measure.
"In the absence of any explicit rules and guidelines, we followed the spirit of the law and passed on the benefits of GST reduction to our customers with immediate effect," Jubilant FoodWorks said in a statement. The company asserted that the loss to the company due to input credit withdrawal was far higher than the price increase that was taken, and this wasn't taken into account by the NAA.
"We are studying the order in detail and will be exploring all possible options for the future," Jubilant FoodWorks said. On Monday, NAA had found the company guilty of not passing on GST-cut benefit of Rs 41.42 crore on sale of some pizza products and has been directed to deposit the illegal gains with the government.
The NAA passed the order on an email complaint filed by a customer that Jubilant FoodWorks had not reduced the prices of 'Dominos Stuffed Garlic Bread' and 'Medium Veg Pizza' despite a cut in GST rate from 18 percent to 5 percent. Goods and Services Tax (GST) rate on restaurants was cut to 5 percent without Input Tax Credit (ITC) from 18 percent with ITC, with effect from November 15, 2017. The NAA held that Jubilant FoodWorks has not passed on the benefit of reduction in the rate of tax to its customers during the period November 15, 2017 to May 31, 2018
(With inputs from agencies.)