Director General of Anti-Profiteering v. Sane Retails Pvt. Ltd.

01 · Facts of the case and issues

The complaint concerned the MI LED Television 4A 80 cm and the recorded GST reduction from 28% to 18% effective 1 January 2019. DGAP compared November–December 2018 with calendar year 2019 and initially computed Rs. 7,79,947 in its report dated 30 March 2021. The NAA/CCI transfers preceded GSTAT’s adjudication; the report itself was not the final tribunal determination.

GSTAT required more than voucher screenshots: the respondent supplied transaction-wise mapping, invoices, credit notes and an explanation of the electronic gift voucher (EGV) mechanism. DGAP accepted Rs. 2,21,056 credit notes for cancelled or returned transactions involving 174 customers, reducing the investigated amount to Rs. 5,58,891. It continued to dispute whether the separate EGV credits constituted valid pass-through.

The respondent relied on Rs. 5,48,650 in EGV credits across 488 orders: Rs. 3,17,965 was recorded as utilised against 291 orders and Rs. 2,30,685 remained available against 197. The table counts orders, although later narrative calls them customers; no independently audited unique-person count is supplied.

Source: Complaint and initial investigation: paragraphs 1–6, physical pp. 2–4. Documentary directions and credit notes: paragraphs 7–12, pp. 4–8. EGV table: physical p. 7.

02 · Discussion and reasoning of the Hon’ble Court

GSTAT found that these activated wallet credits had no expiry, were not tied to a particular product or category, and could be used for products on the respondent’s platform. It treated the credited monetary value as a direct, unconditional transfer linked to the affected customer and invoice. The note does not convert platform spending credit into withdrawable cash or establish usability outside that platform.

DGAP invoked Reckitt’s requirement for benefit to reach the recipient through commensurate price reduction. GSTAT distinguished promotional offers, cross-subsidisation and extra goods from the transaction-linked credits proved here. This is GSTAT’s own distinction of Reckitt, not a finding that the High Court decided or approved this EGV scheme. It should not be extended to expiring, conditional or inadequately traceable vouchers.

The Tribunal also rejected reliance on the system description Offers and cashback. The order ID, invoice, date, price and excess-tax mapping mattered more than that label. It accepted the utilised and continuing balances on the record, but found the Rs. 10,241 difference unreconciled and not passed to any identifiable recipient. The respondent’s offer to deposit that residual did not eliminate the contested EGV issue that the Tribunal decided.

Source: EGV characteristics and precedent distinction: paragraphs 15–16.7, physical pp. 8–11. System label and document chain: paragraphs 17.1–18.3, pp. 11–13. Residual reconciliation: paragraphs 19.1–19.7, pp. 13–15.

03 · Judicial decision and operative relief

GSTAT accepted the EGV method on the recorded facts and found substantial compliance to the extent of Rs. 5,48,650, but a Section 171 contravention for the remaining Rs. 10,241. Paragraph 23 directs deposit of that residual in the Central Consumer Welfare Fund within thirty days from the order. There is no State Fund split in this decision: paragraphs 19.4–19.6 refer to the absence of identifiable customer/invoice and state-wise data.

Paragraph 24 orders 18% interest under Rule 133(3)(c) from collection of the higher amount until deposit in the Fund. That literal direction is preserved; no new commencement cutoff or quantified interest is invented. Paragraph 25 excludes Section 171(3A) penalty because the contravention period preceded the penal provision. Actual residual deposit, later redemption of outstanding credits and subsequent compliance are unverified.

Paragraph 21 describes Rs. 5,48,650 as passed through a combination of credit notes and EGVs, while paragraphs 19.2–19.3 separately exclude the Rs. 2,21,056 cancelled/returned credit notes and identify Rs. 5,48,650 EGVs. The wording tension is retained without double counting. Paragraph 12.2 expressly identifies the earlier report’s 31 March 2019 endpoint as a typographical error; the actual period recorded and applied here ends on 31 December 2019.

Source: Detailed reconciliation: paragraphs 19.2–19.7, physical pp. 14–15. Operative findings/directions: paragraphs 20–28, pp. 15–16. Report-period clarification: paragraph 12.2, pp. 7–8.

04 · In favour of

Final substantive determination after a contested legal and evidentiary examination of the EGV mechanism. Liability survives only for the identified unreconciled residual under this order, with the stated interest; substantial compliance is not complete exoneration or proof of later deposit.

Source: Paragraphs 16–28, physical pp. 9–16.