GSTAT Drops Proceedings Against Eclat Serum Supplier After DGAP Fails To Trace Gujarat Firm

The GST Appellate Tribunal at Delhi recently dropped anti profiteering proceedings against Shree Suktam Enterprise, a Gujarat supplier in the chain of biotech company S R Lifesciences. The tribunal observed that the Director General of Anti Profiteering (DGAP) was unable to trace the firm or obtain evidence to determine whether the benefit of a 10 percent GST rate reduction on the skin care product Eclat Serum 30gm, used in dermatological treatment, had been passed on to consumers.

In an order dated November 12, 2025 delivered by Technical Member A Venu Prasad, the tribunal observed that there was no basis to continue proceedings after multiple attempts to secure records and serve notices failed, resulting in the inability to determine any profiteering liability.

“Accordingly, the proceedings in the present case are hereby dropped,” the order recorded.

However, as the spot inspection confirmed that the firm was not operating at the given address in Ahmedabad, the GSTAT observed that the department may look into any bogus billings done by Shree Suktam towards S R Lifesciences of any other firm.

“It is pertinent to mention here that the department should ascertain whether M/s Shree Suktam Enterprises has indulged in any bogus billing towards M/s S R Lifesciences or any other registered firm. If so, the jurisdictional commissionerate may initiate necessary action against the concerned firm in accordance with the provisions of the CGST Act 2017.”

The case originated from an interim direction issued on May 10 2022 in the matter of S R Lifesciences requiring the DGAP to investigate the supplier network under the CGST Rules. A subsequent direction on July 31 2023 expanded the scope of inquiry to suppliers including Shree Suktam Enterprise in Ahmedabad to determine whether the benefit of a GST rate reduction on Eclat Serum 30gm from 28 percent to 18 percent had been passed on to recipients for the period between November 2017 and July 2023

According to the DGAP, the notice served on August 9, 2023 was returned undelivered with the remark “LEFT”. Follow-up communications to Central and State GST authorities requesting updated details and physical verification did not yield usable information.

A spot inspection by State Tax officials in Ahmedabad confirmed that another business, C.K. Enterprises, had been operating at the registered address for several months and had no knowledge of Shree Suktam Enterprise. With no access to records or confirmation of the firm's presence, the DGAP reported nil profiteering and requested that proceedings be closed.

The tribunal recorded that the DGAP had pursued all available channels, including repeated letters to enforcement and jurisdictional offices, but the investigation could not progress because essential data was unavailable. It observed that if any evidence concerning bogus billing comes to light in future, the jurisdictional authorities would be free to act under the CGST Act.

Holding that the matter could not be sustained without documentary support and the respondent's participation, the tribunal directed closure of the case and asked that copies of the order be shared with relevant GST authorities for any further administrative steps.