One of the issue being faced by the consumers is charging of GST by the retailers in the invoices raised on discounted MRP sales. The retailers were earlier charging VAT on these discounted MRP sale. Hon'able National Commission has already adjudicated that the discounted price as announced by the retailers are the MRP price and thus no tax can be charged by the retailers on the prices arrived after the discounts so offered. I am attempting to clarify the issue as below:

1. Lets say a retailer has announced 50% discount for a product having a price of MRP of Rs. 1,000/-. Lets break these prices into two components namely basic price and tax for the purpose of explaining on the issue. Basic Price: Rs. 900/- and Tax : Rs. 100/-
2. Now as per discount offered, the retailer should sell the product at Rs. 500/- which includes Rs. 450/- as basic price and Rs. 50/- as tax. Alternativel the retailer should raise invoice on 450 (being 50% of Rs. 900/-) and Rs. 50/- as GST (50% of Rs. 100/- tax component).
3. The retailers like Shoppersstop, Myntra, Jabong, Pantaloons, Lifestyle, Aditya Birla are charging GST on Rs. 500/- and billing as Rs. 550/-. As the price of Rs. 500/- already includes Rs. 50/- as Tax, the second charging of Rs. 50/- on Rs. 500/- become Unethical business. Ritu Wears was also earlier doing the same practices. On a complaint of the author of the post, Ritu Wears was penalised by State Controller of Legal Metrology, Haryana and it was assured by Ritu Wears to stop such practices in future. In their recent advertisements they are now clearly stating that "No GST Extra". Snowhite and Home Shop never charge any tax on such discounted sales.
4. In a complaint by another consumer before District Consumer and later on Revision Petition by retailers before State Commission Punjab, the retailers stated that in any case they are billing at price less than MRP and hence do not violate Legal Metrology rules. The contentions of the traders were not accepted by the Hon'able State Commission and the traders among many including Shoppersstop were penalised. National Commission upheld the decision of State Commission in the Revision Petition adjudicating that any discounted prices is also MRP and hence charging of additional tax over discounted price is in violation of Legal Metrology rules and is unfair business practices.
4. Surprisingly these retailers are still continuing unfair business practices and are charging GST extra. In my view we need to protest on such unethical business practices and may consider taking up issue as a class action.
I request all consumers to kindly comment on this post about their experience with such retailers and preferably start complaining to State Controllers. A copy of such complaints with invoice and item tag be mailed to me if you so desire for consolidating the cases against the retailers. If any of the member desires to get any clarification on this issue may like to contact me. I have several articles written on my blog whose link can be given to the members on their emails whosoever desires to go through the issue. more  

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From Wills Lifestyle : Dear Sir, This is with reference to your query regarding charging VAT on the discounted price of the goods, purchased by you from our store during the sale period. We wish to state that during the sale period the goods were sold to you on the discounted price subject to certain terms and conditions. One of the conditions during the sale period was that VAT will be charged additionally on the discounted price of the goods. We are entitled to sell goods at such discount as we may deem fit. The terms and conditions specifically stated that VAT was to be charged at the discounted price and had been prominently put up throughout the store for the attention of the consumers. As such, your allegations are denied. Without prejudice to the aforesaid, please also note that this is standard practice followed by various apparel businesses throughout India during sale season. more  
@Chandan Sharma Ji, I am eagerly awaiting your comments as per my response to your views earlier expressed. However, I have today posted an article on my blog which may also be gone through in case you so desire. more  
Sir Thanks for your kind response on the crucial issue. I am quite hopeful that you have studied the judgements of State Commission and National Commission which has clearly addressed the point stated by you. In nutshell even if you have displayed terms it is still violative of MRP rules and is in contempt to inferences drawn by the above judgements. In case you have not gone through (I feel so as else you should not have stated what you have stated) you are advised to kindly go through the same for corrective steps at this moment. Nevertheless I shall be awaiting your update on the same. With regards more  
While I agree what Shri Virmani stated, I would like to add that two more online sellers who always have discounted sale, do not charge any GST over and above the discounted price. more  
Sir, Can I have the name of those two sellers who are not charging GST over and above discounted price. In fact that is the only criteria. I am still surprised that Lifestyle still trying to justify despite adjudication by the respected forums. When being reminded the companies should take corrective steps in reversing their wrong doings. more  
Sir, Request you to please indicate the name of those online retailers. more  
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