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2022 (8) TMI 145 - NAPA - GSTProfiteering - bookings of the flat to attract new customer - benefit of ITC of GST has been passed by way of commensurate reduction in price or not - contravention of provisions of Section 171 of the CGST Act - HELD THAT:- The Authority finds that, the DGAP has given a categorical report based on its verification that, the benefit of ITC has been passed on by the Respondent to all 189 homebuyers/customers who have booked their units on or after 1.07.2017 by way of giving deduction in the demand note itself as per the example reproduced above. The findings at para 10 and 11 of the DGAP's Report dated 30.11.2020 are reproduced at paragraphs 50), 5(J) and 5 (k) above and the DGAP states that it has scrutinized the demand notes and allotment letters issued to these 189 homebuyers/customers by the Respondent - the Authority determines the profiteered amount for the period from 01.07.2017 to 31.12.2018, in the instant case, as 2,26,76,700/- with respect to the other 500 homebuyers/customers i.e. those who have booked their units prior to 1,07.2017 (excluding those from whom no demand was raised/ consideration received from L07.2017 to 31.12.2018) for the Project “Himalaya Pride”. The Authority finds that the Respondent has profiteered by an amount of Rs. 2,26,76,700/- during the period of investigation i.e. 01.07.2017 to 31.12.2018. The above amount that has been profiteered by the Respondent from his home buyers shall be refunded by him, along with interest 018% thereon, from the date when the above amount was profiteered by him till the date of such payment, in line with the provisions of Rule 133 (3) (b) of the CGST Rules 2017. Interest - HELD THAT:- This Authority under Rule 133 (3) (a) of the CGST Rules, 2017 orders that the Respondent shall reduce the prices to be realized from the buyers of the Units commensurate with the benefit of ITC received by him - The Respondent is also liable to pay interest as applicable on the entire amount profiteered, i.e. Rs. 2,26,76,700/-. Hence the Respondent is directed to also pass on interest @ 18% to the homebuyers/customers on the entire amount profiteered, starting from the date from which the above amount was profiteered till the date of passing on/ payment, as per provisions of Rule 133 (3) (b) of the CGST Rules 2017. Penalty - HELD THAT:- The Respondent has denied benefit of ITC to the homebuyers/customers of the Units being constructed by him in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has committed an offence under Section 171 (3A) of the above Act. Section 171 (3A) of the CGST Act, 2017 has been inserted in the CGST Act, 2017 vide Section 112 of the Finance Act, 2019, w.e.f. 01.01.202 and hence, was not in force during the period of investigation i.e. from 01.07.2017 to 31.12.2018, when the Respondent had committed the above violation and hence, the penalty prescribed under Section 171 (34) cannot be imposed on the Respondent retrospectively. This Order having been passed today falls within the limitation prescribed under Rule 133(1) of the CGST Rules, 2017.
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