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Q 1. What is profiteering? Ans. In terms of Section 171 of the CGST Act, 2017, the suppliers of goods and services should pass on the benefit of any reduction in the rate of tax or the benefit of input tax credit to the recipients by way of commensurate reduction in prices. The wilful action of not passing on the above benefits to the recipients in the manner prescribed is known as “profiteering”. Q 2. What is the background to providing statutory provisions on antiprofiteering in GST law? Ans. The Study Report titled ‘Implementation of Value Added Tax (VAT) in India-Lessons for transition to GST’ released by the Comptroller & Auditor General (C&AG) of India in June, 2010 mentioned about several cases of profiteering by dealers by not passing on the benefit of tax rate reduction to the consumers in the wake of implementation of VAT in the country. The above C&AG report, after checking the records of 13 manufacturers in a State in three initial months of implementatio...

Audit Key Notes Final (Old) Exam: November, 2019 11(a). Dealing with company undergoing IBC procedures - SA 570 Going Concern Check material uncertainty in relation to entity’s ability to continue as a going concern and for this, Request management to make assessment of entity’s ability to continue -- Evaluate the plan for future actions in relation to going concern assessment with angle whether the outcome of plans is going to improve situation or not -- If cash flow forecast is done, then check the adequacy of underlying assumption -- Consider any additional facts available after assessment -- Request written representation from Management about future action plan. -- Auditor shall evaluate whether, in view of financial reporting framework ( FRF ), the financial statements  (F.St.)  provide adequate disclosures about these events or conditions. Resolution plan under IBC is a significant mitigating factor to counter the going concern issues of entity has su...