The government is considering relaxing the conditions for declaring a revised retail sale price (MRP) on unsold stock due to changes in GST rates. In a related development, the government has urged Indian businesses to cooperate in ensuring a smooth transition and to pass on the benefits of these GST cuts.
These and other issues were discussed in a meeting on Wednesday, chaired by Sanjay Kumar Agarwal. The meeting included representatives from four industry bodies — CII, FICCI, Assocham and PHDCCI — as well as officials from the Ministries of Consumer Affairs, Commerce & Industry, Heavy Industries, and Agriculture & Family Welfare.
According to officials, a primary concern raised was the practical difficulty of revising the MRP on packaging and labels for stock already at the retail level. The industry requested a relaxation of the norms recently issued by the Consumer Affairs Department. The department had previously allowed manufacturers, packers, and importers of pre-packaged goods to declare a revised MRP on unsold stock until December 31, 2025, or until the stock is exhausted, whichever is earlier.
Three conditions
The department stipulated that the new MRP could be declared by stamping, using a sticker, or through online printing, subject to three conditions: the original MRP must remain visible and not be overwritten; the difference between the original and revised price cannot exceed the amount of the tax increase or decrease; and manufacturers, packers, or importers must publish at least two advertisements in one or more newspapers and circulate notices to dealers and the government, detailing the price change.
Industry representatives requested that they be allowed to comply with only one of these three conditions instead of all of them. Officials indicated they would consider this request, with a revised communication expected soon.
Other issues
Industry chambers also brought up several other issues, including the refund or credit of compensation cess and inverted duty structures in the food and pharmaceutical industries.
According to an industry expert urged the industry to ensure there are no profiteering issues or consumer complaints. The board explicitly asked businesses to cooperate with the government in making a smooth transition and passing on the benefits of GST cuts.
Another key issue was the utilisation of accumulated cess amounts. According to attendees, the CBIC reiterated that a compensation cess refund or credit would not be possible due to the removal of the levy. Additionally, group health insurance for corporate employees is not exempt, and the input tax credit (ITC) for businesses remains restricted under blocked credit as per the law. Sources indicated there is no immediate plan to include input services in inverted duty structure refunds.
