Anti-profiteering Authority dismisses complaints against KFC, Amway India

The National Anti-profiteering Authority (NAA) has dismissed complaints of profiteering against KFC and Amway India. Both the complaints were dismissed for lack of evidence.

Not passing benefits

The firms were facing allegation that they were not passing on the benefit of duty reduction and thus made additional profit. KFC is a well known food outlet brand famous for chicken based food products. There are more than 700 outlets in India of the KFC, a subsidiary of US-based ‘Yum! Brand Inc’.

Amway India is a direct selling company with more than 5.50 lakh ABOs (Amways Business Owners). It sells over 140 products covering five categories and has nationwide presence with over 130 sale offices and a number of small and big warehouses.

Both the companies did not comment on the rulings. Meanwhile, Harpreet Singh, Partner at KPMG, said the orders have set a good precedent. “In terms of the orders frivolous anti-profiteering complaints, which are not supported by adequate documentary evidence to substantiate profiteering by dealers, would not be entertained,” he said.

Yum Restaurants

In the case related to KFC, the complainant alleged that the outlet has not passed on the benefit of reduction of tax from 18 per cent to 5 per cent to customers.

He also alleged that the outlet was supplying burger at ₹40 (inclusive of tax) before November 15, 2017. However, when duty reduction made applicable from November 15, the outlet started charging ₹42. But, when Directorate-General - Anti-profiteering (DG-AP) asked the complainant to furnish pre- and post-GST invoices and also the name of outlet which allegedly supplying food and higher price, he could not produce them.

Since, there was no specific evidence of profiteering, the DG-AP made it clear that he was not in a position to initiate the investigation. Also, all franchisees cannot be investigated. The report was submitted to NAA which considered and ruled that there is no case of profiteering and accordingly matter dismissed.

Amway India

A complaint was made against the company but the complainant neither gave his name nor any contact details. It was alleged that the company has not passed on the benefit of duty reduction from 28 to 18 per cent on select items.

Here too, despite repeated requests, no documentary evidence was provided. Accordingly, the DG-AP reported that in the absence of clear-cut evidence, an investigation cannot be launched. Upon receiving the DG-AP report, NAA called a meeting of all parties involved, but the complainant failed to appear, forcing the authority to dismiss the case.

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