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2022 (6) TMI 1075 - NAPA - GSTProfiteering - Project Suncity Avenue-102 - allegation is that the benefit of reduction in the GST rate by way of commensurate reduction in prices, were not passed on - contravention of Section 171 of CGST Act - penalty - HELD THAT:- This Authority observes that the benefit of additional Input Tax Credit of 3.07% of the turnover has accrued to the Respondent for the project “Suncity Avenue 102”. This benefit was required to be passed on to the recipients, however, the same was not done commensurately by the Respondent. Section 171 of the CGST, 2017 has been contravened by the Respondent, in as much as the additional benefit of ITC @3.07% of the base price has not been passed on by the Respondent to 736 recipients. These recipients were identifiable as per the documents provided by the Respondent, giving the names and addresses along with Unit no. allotted to such recipients. Therefore, the total additional amount of Rs. 2,62,56,652/- was required to be returned to the such homebuyers. The Authority determines that the Respondent has profiteered an amount of Rs. 2,62,56,652/-. Therefore, given the above facts, the Authority under Rule 133 (3) (a) of the CGST Rules orders that the Respondent shall reduce the price to be realized from the buyers of the flats commensurate with the benefit of ITC received by him. The details of the recipients and benefit which is required to passed on to each recipient/homebuyer (including Applicant No. 1) alongwith the details of the unit are contained in the Annexure' A' to this order. The Authority directs that such profiteered amount as determined shall be passed on/returned by the Respondent to the recipients of supply alongwith interest @18% from the date such amount was profiteered by the Respondent uptil the date such amount is passed on/returned to the respective recipient of supply. Penalty - HELD THAT:- The Respondent has committed an offence by violating the provisions of Section 171 (1) during the period from 01.07.2017 to 08.08.2019, and therefore, he is liable for imposition of penalty under the provisions of Section 171 (3A) of the above Act. However, perusal of the provisions of the said Section 171 (3A) shows that it has been inserted in the CGST Act, 2017 w.e.f. 01.01.2020 vide Section 112 of the Finance Act, 2019 and it was not in operation during the period from 01.07.2017 to 08.08.2019 when the Respondent had committed the above violation. Hence, the said penalty under Section 171 (3A) cannot be imposed on the Respondent retrospectively. Accordingly, notice for the imposition of penalty is not required to be issued to the Respondents. This Order having been passed today falls within the limitation prescribed under Rule 133 (1) of the CGST Rules, 2017. Application disposed off.
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