Cinema Operator Held Guilty of Profiteering After GST Rate Cut | GSTAT

Case Details: DG Anti Profiteering, Director General of Antiprofiteering, DGAP vs. ASR Cinema LLP - [2026] 187 taxmann.com 139 (GSTAT - NEW DELHI)

Judiciary and Counsel Details

• A. Venu Prasad, Technical Member.

Facts of the Case

A complaint was filed alleging that the respondent, a cinema operator, had failed to pass on the benefit of reduction in GST rate on cinema admission tickets from 18% to 12% with effect from 1 January 2019. Upon investigation, the Director General of Anti-Profiteering found that instead of reducing ticket prices commensurately, the respondent had increased the base prices while maintaining the same cum-tax selling price, thereby denying the benefit of tax reduction to consumers. The respondent did not participate in the proceedings despite repeated opportunities, and the matter was adjudicated on the basis of the material available on record.

GSTAT Held

The GST Appellate Tribunal held that the respondent had failed to pass on the benefit of the GST rate reduction to consumers as mandated under Section 171 of the CGST Act. It was observed that by increasing the base price of cinema tickets after the tax rate reduction and retaining the same cum-tax price, the respondent had indulged in profiteering. The Tribunal further held that any permission granted by the High Court to collect proposed ticket fares could not override the statutory obligation to pass on the benefit of tax reduction. Accordingly, the respondent was directed to deposit the profiteered amount, including the GST component, along with interest at 18% per annum. Since the recipients were not identifiable, 50% of the amount was directed to be deposited in the Central Consumer Welfare Fund, and the remaining 50% in the Telangana State Consumer Welfare Fund.

List of Cases Referred to

• AMB Cinemas LLP v. State of Telangana [W.P. No. 2482 of 2019, dated 8-2-2019] (para 17)
• Sri Sai Ram v. State of Telangana [WP. No. 21782 of 2018, dated 28.06.2018] (para 22)
• Sudarshan Theatre v. Union of India [2024] 164 taxmann.com 331/105 GST 418/88 GSTL 293 (Telangana) (para 24)
• Reckitt Benckiser India (P.) Ltd. v. Union of India [2024] 158 taxmann.com 675/102 GST 495/82 GSTL 344 (Delhi) (para 29)
• DGAP v. Proctor & Gamble Group [2025] 178 taxmann.com 564 (GSTAT – NEW DELHI) (para 39)