KOCHI: Goods and Services Tax (GST) came as a boon for many, especially those in the services industry like the hotels and restaurants. They found it an avenue to fleece their customers. One of the items that featured high in this fleecing exercise was the mineral water bottles. Recently, Legal Metrology Department (LMD) conducted a drive in four districts in Central Kerala and registered cases against seven restaurants and hotels for selling mineral water bottles at a rate higher than the market price. Interestingly, a few star hotels were also found to be cheating the tourists by over-charging. “With GST in force, customers need to be vigilant over overpricing. Customers should not pay more than the MRP mentioned on the packaged goods. The MRP includes all the taxes,” R Rammohan, Deputy Controller, Legal Metrology Department said.
The modus operandi adopted by the hotels and restaurants to wring out additional money from their customers is to show the excess amount as GST on the bill. “The hoteliers charge additional GST for mineral water in the final bill. This is an illegal practice. Mineral water comes under packaged goods category and no separate GST can be charged. Such practises should be questioned by the customers. They can also inform us about being overcharged by the restaurants and hotels,” he said.
The section 36(1) of the Packaged Commodity Rules states whoever manufactures, packs, imports, sells, distributes, delivers or otherwise transfers, offers, exposes or possesses for sale, or causes to be sold, distributed, delivered or otherwise transferred, offered, exposed for sale any pre-packaged commodity which does not conform to the declarations on the package as provided in the Act, shall be punished with a fine which may extend to R25,000.
Also, several mineral water companies were found to be charging different MRPs for the same quantity and quality. However, such practices will come to an end by January 1, 2018. “It is mostly seen in the theatres and multiplexes. Water bottles of the same weight belonging to a particular company is being sold at different MRPs. The Central government has brought out a notification which prohibits dual pricing from January 1,” an officer with Legal Metrology department.
Amendment was brought in section 18 of Legal Metrology (Packaged Commodities) Rules by adding a subsection which stated that-Unless otherwise specifically provided under any other law, no manufacturer or packer or importer shall declare different maximum retail prices on an identical pre-packaged commodity by adopting restrictive or unfair trade practices.
Cheating in the name of GST was found to be taking places in the malls outside Ernakulam. “During the drive held in the four districts, we found several malls in Thrissur charging an additional price for juice bottles and packed food products. They increase the amount in the final bill. Malls in Ernakulam were not found overcharging in such a way,” an official said.