TMI Blog2018 (4) TMI 1377X X X X Extracts X X X X X X X X Extracts X X X X ..... post GST era, was factually incorrect as the pre-GST rate of tax, on the car contracted to be purchased by the applicant, was leviable at 31.254% which was rationalized to 29% (CGST-14%+SGST-14%+Cess-1%)thus there was a reduction of only about 2% - the benefit of reduction in the tax rate was passed on to the applicant by way of reduction in the price of the car of base colour by an amount of ₹ 10,550/-. Whether any input tax credit benefit was to be passed on to the applicant by the respondent? - Held that: - the respondent has given details of all the basic components of the price of the car purchased by the applicant as has been mentioned in Table 'B' above and benefit of ₹ 10,550/- on account of reduction of tax by about 2% viz. from 31.254% (pre GST) to 29% (post GST), as discussed above, has already been passed on to the applicant and the amount of ₹ 10,550/- is inclusive of the ITC as has been calculated in Table 'B' - no additional benefit on account of ITC is required to be paid by the respondent. The respondent has not contravened the provisions of Section 171 of the CGST Act, 2017 - application dismissed. - 1/2018 - - - Dated:- 27-3-2018 - Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licant vide his letter dated 16-02-2018 (Annexure-6) had intimated that he was satisfied with the reply given by the respondent and therefore the case may be closed. 3. The respondent, in his replies dated 26.12.2017 and 28 01.2018 had stated that he was registered under the GST and was engaged in trading and servicing of the cars and he was bound to sell cars at the ex-showroom price fixed by M/s Honda Cars Ltd. The respondent had justified the price charged by him from the applicant and maintained that the contention of the applicant that the pre-GST duties and taxes on such cars amounted to 51% was wrong and in fact, the total pre-GST tax incidence was 29.175% only and hence, there was a very negligible difference in the incidence of tax. The respondent had also submitted that he had reduced the dealer's margin from ₹ 33,736/- to ₹ 25,826/- and the price of the car by ₹ 4,000/- on account of the change in the colour of the car from Orchid White (premium colour) to Alabaster Silver (base colour), as per the applicant's request. 4. The respondent had also intimated that the car of Orchid White colour was booked by the applicant vide Sale Contrac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dealer's margin appeared to be ₹ 33,619/- and not ₹ 25,826/-, as claimed by the respondent. 8. The DGSG had further found that the contention of the applicant that the total incidence of tax on the car was reduced from 51% to 29% post-GST, was also not correct as there was a minor reduction in the tax rate in the post-GST period and the tax rate had remained more or less the same. He had also calculated the comparative rates of pre-GST and post-GST tax on the model of car purchased by the applicant which are given in Table 'A' below:- Table A Duty/Tax/Cess Pre-GST Rate (%) Post-GST Rate (%) Excise Duty (S. No. 285 of Notification No. 12/2012 dt. 17.03.2012 as amended 12.5 - National Calamity Contingent Duty (NCCD) 1 - Auto Cess 0.125 - Infra Cess 1 - Total (A) 14.625 - CST(B=0.05% on A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ex-showroom price of Orchid white colour car Q=O+P 9,13,300 Price charged from the applicant 8,98,750 Benefit passed on to the applicant (excluding ₹ 4,000/- reduced for change in colour) 10,550 10. The DGSG had also found that the allegation of the applicant that the total tax prior to the implementation of GST was 51% which was reduced to 29% w.e.f. 01.07.2017, was not correct. He had further found that claim of the applicant that though the price charged from him of ₹ 8,98,750/- was less than the contractual price of ₹ 9,13,300/- still the said reduction was not commensurate with the reduction in the rate of tax was also not correct. It was also revealed that while the total incidence of tax was approximately 31.254% previously, which was fixed as 29% w.e.f. 01 07.2017, thus there was reduction of just over 2%. 11. The DGSG had also concluded that although the car of premium colour was booked at an amount of ₹ 9,13,300/- at the pre-GST tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the matter and find that the following two points pertaining to the allegations of profiteering against the respondent need to be decided as per the provisions of Section 171 of the CGST Act, 2017; i. Whether there was a substantial reduction in the rate of tax on the cars after the GST was implemented w.e.f. 1 st July 2017 as claimed by the applicant and whether the benefit as emanating from such reduced tax rate has not been passed on to the applicant in the form of commensurate reduction in the price of the car purchased by him. ii. Whether any input tax credit benefit was to be passed on to the applicant by the respondent. 15. With regard to point no. (i) above It has been found from the record that the rate of tax both during pre-GST era as well as the post GST era was a matter of fact which has been clearly delineated in detail by the DGSG in his report dated 23.02 2018 as has been mentioned above. It has also been found that the applicant's contention that the pre-GST rate of tax which was 51% was reduced to 29% in post GST era, was factually incorrect as the pre-GST rate of tax, on the car contracted to be purchased by the applicant, was leviable at 31. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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