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2022 (8) TMI 94 - NAPA - GSTProfiteering - purchase of flat - it is alleged that the Respondent had not passed on the benefit of input tax credit to him by way of commensurate reduction in price - Contravention of Section 171 of the Central Goods and Services Tax Act, 2017 - penalty - HELD THAT:- The Authority finds that, the Respondent has benefited from the additional ITC to the extent of 0.46% of the turnover during the period from 01.07.2017 to 31.12.2018 and hence the provisions of Section 171 of the CGST Act, 2017 have been contravened by the Respondent as he has not passed on the above benefit to his customers. The Authority determines that, the Respondent has realized an additional amount of Rs. 3,763/- which includes both the profiteered amount @ 0.46% of the taxable amount (base price) and 12% GST on the said profiteered amount from the Applicant No. 1. The Authority determines that, the Respondent has realized an additional amount of Rs. 49,22,281/- which includes both the profiteered amount @ 0.46% of the taxable amount (base price) and GST @ 8% / 12% on the said profiteered amount from the 394 flat buyers other than the Applicant No. 1. The Authority determines that, the Respondent has profiteered an amount of Rs. 49,26,054/- inclusive of GST @ 8% / 12% as calculated in the aforesaid Report dated 31.08.2020 for the stated period. Hence, the Authority holds that the Respondent is required to pass on the benefit of ITC along with the interest @ 18% per annum from the dates from which the above amount was collected by him from them till the payment is made as prescribed under Rule 133 (3)(b) of the CGST Rules, 2017, within a period of 3 months from the date of this Order as per the details mentioned in Annexure-A to this Order. - this Authority under Rule 133 (1) (a) of the CGST Rules, 2017 orders that the Respondent shall reduce the prices to be realized from the buyers of the flats of the above Project commensurate with the benefit of ITC received by him. The present investigation has been conducted up to 31.12.2018 only. However, the Respondent has not obtained the Completion Certificate (CC) till that date. Therefore, he is liable to pass on the benefit of ITC which would become available to him till the date of issue of CC. Accordingly, the concerned jurisdictional Commissioner CGST/SGST are directed to ensure that the Respondent passes on the benefit of ITC to the eligible flat buyers as per the methodology approved by this Authority in the present case and submit report to this Authority through the DGAP. The Applicant No.1 or any other flat buyer shall also be at liberty to file complaint against the Respondent before the Maharashtra State Screening Committee in case the remaining benefit of ITC is not passed on to them. Penalty - HELD THAT:- The Authority finds that vide Section 112 of the Finance Act, 2019 specific penalty provisions have been added for violation of the provisions of Section 171 (1) which have come in to force w.e.f. 01.01.2020, by inserting Section 171 (3A), Since, no penalty provisions were in existence between the period from 01.07.2017 to 31.12.1018 i.e. the period of the present investigation for which the profiteered amount has been calculated and the Respondent is found to have violated the provisions of Section 171 (1), the penalty prescribed under Section 171 (3A) cannot be imposed on the Respondent for profiteering done during such period. This Order having been passed today falls within the limitation prescribed under Rule 133(1) of the CGST Rules, 2017.
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