1. Lets say a retailer has announced a 50% discount on a price of MRP of Rs. 1,000/-. Lets break these prices into two components namely basic price and tax for the purpose of explaining on the issue. Basic Price: Rs. 900/- and Tax : Rs. 100/-
2. Now as per discount offered, the retailer should sell the product at Rs. 500/- which includes Rs. 450/- as basic price and Rs. 50/- as tax.
3. The retailers like Shoppersstop, Myntra, Jabong, Pantaloons, Lifestyle, Aditya Birla are charging GST on Rs. 500/- and billing as Rs. 550/-. As the price of Rs. 500/- already includes Rs. 50/- as Tax, the second charging of Rs. 50/- on Rs. 500/- become Unethical business. Ritu Wears was also earlier doing the same practices. On a complaint of the author of the post, Ritu Wears was penalised by State Controller of Legal Metrology, Haryana and it was assured by Ritu Wears to stop such practices in future. In their recent advertisements they are now clearly stating that "No GST Extra". Snowhite and Home Shop never charge ant tax on such discounted sales.
4. In a complaint before State Commission Punjab, the retailers stated that in any case they are billing at price less than MRP and hence do not violate Legal Metrology rules. The contentions of the traders were not accepted by the State Commission and the traders among many including Shoppersstop were penalised. National Commission upheld the decision of State Commission in the Revision Petition stating that any discounted prices is also MRP and hence charging of additional tax over discounted price is in violation of Legal Metrology rules and is unfair business practices.
4. Surprisingly these retailers are still continuing unfair business practices and are charging GST extra. In my view we need to protest on such unethical business practices and may consider taking up issue as a class action.
I request all consumers to kindly comment on this post about their experience with such retailers and preferably start complaining to State Controllers. A copy of such complaints with invoice and item tag be mailed to me if you so desire for consolidating the cases against the retailers. If any of the member desires to get any clarification on this issue may like to contact me. I have several articles written on my blog whose link can be given to the members on their emails whosoever desires to go through the issue. more