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2019 (11) TMI 1083 - NAPA - GSTProfiteering - purchase of a flat in project “Risington OMR, Karapakkam” - benefit of Input Tax Credit (ITC) by way of commensurate reduction in the price not passed on - contravention of section 171 of CGST Act - penalty - HELD THAT:- It is established from the perusal of facts of the case that the provisions of Section 171 of the CGST Act, 2017 have been contravened by the respondents as he has failed to pass on the benefit of additional ITC to his customers. Accordingly, he is directed to pass on an amount of Rs, 41,434/- to the above applicant and an amount of ₹ 1,01,09,156/- (₹ 1,01,50,590 - ₹ 41,434/-) to the other flat buyers who are not applicants in the present proceedings. It is clear that the respondent has profiteered by an amount of ₹ 1,01,50,590/- during the period of investigation from 01.07.2017 to 31.08.2018 - therefore, this authority u/r 133(3)(a) of the CGST Rules, 2017 orders that the respondent shall reduce the prices to be realized from the buyers of the flats commensurate with the benefit of ITC received by him. The present investigation is only up to 31.08.2018 therefore, any additional benefit of ITC which shall accrue subsequently shall also be passed on to the buyers by the respondent as per provisions of sections 171 (1) of CGST Act, 2017. Penalty - HELD THAT:- The Respondent has denied the benefit of ITC to the buyers of the flats being constructed by him in contravention of the provisions of Section 171(1) of the CGST Act, 2017 and has thus profiteered as per the explanation attached to Section 171 of the above Act. Therefore he is liable for imposition of penalty under Section 171 (3A) of the CGST Act, 2017 - Therefore, a Show Cause Notice be issued to him directing him to explain why the penalty prescribed under the above sub-section read with Rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him.
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