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2022 (8) TMI 362 - NAPA - GSTProfiteering - construction service - allegation is that the Respondent had not passed on the benefit of Input Tax Credit (ITC) to her by way of commensurate reduction in price - contravention of section 171 of CGST Act - interest - penalty - HELD THAT:- The Authority finds that in the present case, the Respondent has raised invoice to his home buyers which included the consolidated demand of the land and the construction services. No separate demand for the land in the invoice has been issued by the Respondent to his home buyers. The Authority finds that, if the Respondent would have issued separate invoice demanding the cost of land, the amount of GST charged would have been 18% and not 12%. The Authority finds that, had the Respondent excluded the land value from the demand raised to his buyers, the value of land would have been excluded from the preview of profiteering. Therefore, the Authority finds that the facts or the cases relied upon by the Respondent are different from the present case. Hence, the Authority finds that this contention of the Respondent regarding exclusion of land value being untenable cannot be accepted. The Authority finds no reason to differ from the above detailed Computation of profiteering in the DGAP's Report or the methodology adopted. Hence, the Authority holds that, the as a percentage of the turnover that was available to the Respondent during the pre-GST period (April-2016 to June-2017) was 3.71 % and during the post-GST period (July-2017 to September-2019), it was 8.76% - the Authority determines the profiteered amount for the period from 01.07.2017 to 30.09.2019, in the instant case, as Rs.1,07,67,330/- for the project 'MJR Clique Hydra'. This profiteered amount of Rs. Rs.1,07,67,330/- includes GST on the base profiteered amount of Rs. 96,13,687/-homebuyer/customer "recipient and unit No. wise break-up of this amount as given in Annexure-13 of the DGAP Report is accepted. This amount is inclusive of Rs.1,03,453/- (including GST on the base amount of Rs. 92,369/-) which is the profiteered amount in respect of the Applicant No. 1, mentioned at serial No. 108 of Annexure-13 of the said Report. The Authority determines the profiteered amount for the period from to 30.09.2019. in the instant case. as Rs. Rs.1,07,67,330/- for the project 'MJR Clique Hydra'. This profiteered amount of Rs. Rs.1,07,67,330/- includes GST on the base profiteered amount of Rs.96,13,687/-. The homebuyer/customer /recipient and unit No. wise break-up of this amount as given in Annexure-13 of the DGAP Report is accepted. This amount is inclusive of Rs.1,03,453/- (including GST on the base amount of Rs. 92,369/-) which is the profiteered amount in respect of the Applicant No. 1, mentioned at serial No. 108 of Annexure-13 of the said Report. Interest - HELD THAT:- The Respondent is liable to pay interest to all customers/ flat buyers/ recipients. as prescribed and applicable on the entire amount profiteered. i.e. Rs. Rs.1,07,67,330/- for the project ‘MJR Clique Hydra'. Hence the Respondent is directed to also pass on interest @18% to the customers/ flat buyers/ recipients on the entire amount profiteered, starting from the date from which the above amount was profiteered till the date of passing on payment of the profiteered amount, as per the provisions of Rule 133 (3) (b) of the CGST Rules 2017. Penalty - HELD THAT:- The Respondent has denied benefit of ITC to the customers/ flat buyers/ recipients in his project ‘MJR Clique Hydra’ 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. However, perusal of the provisions of Section 171 (3A), under which liability for penalty arises for the above violation, 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 30.09.2019 when the Respondent had Committed the above violation and hence, the penalty prescribed under Section 171 (3A) cannot be imposed on the Respondent retrospectively for the said period. This Order having been passed today falls within the limitation prescribed under Rule of the CGST Rules, 2017.
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