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2020 (1) TMI 1578 - NAPA - GSTProfiteering - purchase of Flats - allegation is that Respondent had not passed on the benefit of Input Tax Credit (ITC) availed by him by way of commensurate reduction in the price - contravention of section 171 of CGST Act - Penalty - HELD THAT:- The Respondent has indeed benefited on account of ITC to the extent of 2.67% of his turnover during the post-GST period, i.e. from July, 2017 to December, 2018 and hence the provisions of Section 171 of the CGST Act, 2017 have been contravened by the Respondent since he has not passed on the above benefit to his home buyers. Further he has profiteered to the extent of Rs. 1,95,86,429/-, inclusive of GST @ as applicable, on the base profiteered amount of Rs. 1,78,84,716/-. Further, it is clear to us that the Respondent has realized additional amounts of Rs. 25,282/- each from the Applicant No. 1 and 2, inclusive of GST. The Respondent has also realized an additional amount of Rs. 1,95,35,865/- (inclusive of GST as applicable) from all the home buyers other than the Applicant No. 1 and 2. The total amount of profiteering on part of the Respondent works out to be Rs. 1,95,86,429/- ( Rs. 1,95,35,865 + Rs. 25,282/- + Rs. 25,282/- ) and the same is tabulated in Annexure- 17, 18 and 19 of the Report of the DGAP dated 19.06.2019. On perusal of Table-D of the DGAP Report dated 19.06.2019 suggests an amount of Rs. 81,82,783/- has been claimed to have been passed on by the Respondent to his home buyers on account of ITC benefit. However, it is also clear from Table-D of the DGAP Report and claim of the Respondent of having passed on the benefit of Rs. 81,82,783/-, has not been verified at any stage by the DGAP. Further, the claim made by the Respondent during the hearings held before this Authority of having passed on another tranche of benefit of ITC to his home buyers, taking the total ITC benefit passed on to Rs. 2,18,87,807/-, also needs to be verified by the DGAP. Accordingly the DGAP is directed to further verify the total amount of ITC benefit claimed to have been passed on to his home buyers by the Respondent till date, as per the provisions of Rule 133 (4) of the above Rules and submit his Report clearly mentioning the verified amount of benefit passed on by the Respondent to his home buyers and the balance amount still to be passed on to each of the home buyers within a period of two months of this Order. Keeping in view the self-admission of the Respondent in which he has stated that he is liable to pass on the benefit of additional ITC as per the provisions of Section 171 of the Act, there is reasonable ground to believe that the Respondent is required to pass on the benefit of additional ITC to the eligible house buyers in respect of the above projects. Accordingly, the DGAP is also directed to investigate the issue of passing on the benefit of additional ITC in respect of the above three projects i.e. projects undertaken by the Respondent, in terms of Section 171 (2) of the CGST Act, 2018 read with Rule 133 (5) of the CGST Rules, 2017 and submit his Report. Application disposed off.
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