Hyderabad theatre told to pay Rs 12.8 lakh for charging Rs 11 extra per ticket

A movie theatre in Hyderabad charged Rs 11.74 more on a ticket from two moviegoers, and the theatre has now been ordered to refund the excess amount with 18 percent interest to the duo, as well as pay around Rs 13 lakh to the government’s consumer welfare fund.

Three years ago, two Hyderabad residents complained to the National Anti-profiteering Authority (NAA) about the Shalini Shivani theatres near Chaitanyapuri metro station. According to the complaint, the theatre raised their base price when the GST on admission fees was reduced from 18 percent to 12 percent, as reported by TOI. The theatre charged an additional Rs 11.74 per ticket in the executive category and Rs 16.06 in the gold category.

The NAA asked Miraj Entertainment Limited which runs the theatre to remit Rs 12.87 to the consumer welfare fund of both Centre and Telangana for not reducing Goods and Service Tax (GST).

According to the theatre owners, 49.5 percent of total revenue from tickets went to distributors and the company retained 50.5 percent, ie. Rs 5.33 lakh. The company admitted that it did not pass on the benefit to moviegoers.

The NAA is the statutory mechanism under GST law to check the unfair profiteering activities by the registered suppliers under GST law. The Authority’s core function is to ensure that the commensurate benefits of the reduction in GST rates on goods and services done by the GST Council and of the Input tax credit are passed on to the recipients.

Recently, the NAA directed Larsen & Toubro Parel Project LLP and Omkar Realtors Developers Private Limited to refund Rs 30.76 crore to homebuyers with interest to 850 investors in Mumbai’s Crescent Bay project. The buyers complained that they have not received the full benefit of input tax credit (ITC) on the GST payments made to developers.