9911796707
TMI Blog2019 (9) TMI 1251X X X X Extracts X X X X X X X X Extracts X X X X ..... CGST Rules, 2017 in which he had alleged that he had booked a flat, in the Respondent's project "Paramount Emotions" situated in GH-05A, Sector 1, Greater Noida and the Respondent had not passed on the benefit of Input Tax Credit (ITC) to him by way of commensurate reduction in the price of the flat, on introduction of the Goods & Services Tax (GST) w.e.f. 01.07.2017. The Uttar Pradesh State Screening Committee on Anti-profiteering on prima facie having satisfied itself that the Respondent had not passed on the benefit of ITC had forwarded the said application with its recommendation to the Standing Committee on Anti-profiteering for further action, in terms of Rule 128 of the above Rules. 2. The above reference was examined by the Standing Committee on Anti-profiteering in its meeting held on 06.09.2018 and it had forwarded the same to the DGAP for detailed investigation. The application was sent to the DGAP along with the details submitted by the Applicant No. 1 viz. the duly filled in Form APAF-1, Copy of the demand letter issued at the time of possession, Copy of the letter of offer of possession and copy of the Voter ID card. 3. The DGAP on receipt of the application had is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him. The Respondent had further claimed that the slowdown in the construction industry with sales going down and unwillingness of the banks to support the industry, had led to a situation where the interest and other costs had arisen and the developers were not in a position to meet their statutory and other obligations. 9. The Respondent had further informed the DGAP that the Applicant No. 1 had transferred an amount of Rs. by RTGS on 28.03.2018 but he had not informed the Respondent about this payment and in March, 2019, the Applicant No. 1 had claimed to have paid the said amount with proof of payment and thereafter it was duly accounted for by the Respondent in March, 2019 and the above amount was kept in the client suspense account during the period from March, 2018 to March, 2019. 10. The Respondent had also furnished the Copies of GSTR-1 returns for the period from July, 2017 to March, 2018, Copies of GSTR-3B returns for the period from July, 2017 to March, 2018, Tran1 statement for the month of July, 2017, Copies of VAT & ST-3 returns for the period from April, 2016 to June, 2017, Copies of Electronic Credit Ledger for the period from July, 2017 to March, 2018, Copies of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reversed and the computation of the same has been furnished by him in the Table given below:- Table B (Amount in Rs.) Particulars Factor Amount Total Saleable Area of Flats (in sq. ft.) A 2249965 Area Sold before Completion Certificate was obtained (in sq. ft.) B 1945823 Area sold before Completion Certificate was obtained (in Percentage) C=B/A 83.48% Area remaining Unsold at the time Completion Certificate was obtained (in sq. ft.) D=A-B 304142 Area remaining Unsold at the time Completion Certificate was obtained (in Percentage) E=D/A 13.52% ITC available for the period between July, 2017 till August, 2018 F 70583035 Proportionate ITC to be reversed (in Rs.) G=F*E 9542833 ITC Availed post GST pertaining to sold Units H=F-G 61040252 The DGAP has further submitted that the Respondent had not made any reversal of the ITC, as was required in terms of Section 17(2) and Section 17(3) of the CGST Act, 2017. 14. The DGAP in his Report has also stated that from the information submitted by the Respondent, the details of the ITC availed by him, his turnover from the project during the pre-GST (April, 2016 to June, 2017) and post-GST (July, 2017 to August, 2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to the post GST period (July, 2017 to August, 2018), where it was 4.48%, which indicated that in the post-GST period, the Respondent had benefited from additional ITC to the tune of 2.42% [4.48% (-) 2.06%] of the turnover. 16. The DGAP has also submitted that the profiteering had been examined by comparing the applicable tax rate and the ITC available during the pre-GST period (i.e. April, 2016 to June, 2017) when Service Tax was leviable @ 4.5% with the post-GST period (i.e. July, 2017 to August, 2018) when the GST rate was 12%, in terms of Notification No. 11/2017-Central Tax (Rate), dated 28.06.2017. Thus, on the basis of the figures contained in the Table given above, the ratio of ITC to the turnover during the pre-GST and the post-GST periods, the turnover from the flats booked till the issue of Completion Certificate, received/ to be received in the post-GST period, the recalibrated base price on the basis of the benefit of additional ITC post-GST and the excess collection/realization (profiteering) by the Respondent, was as has been tabulated in the Table given below:- Table D (Amount in Rs.) S.No. Particulars Pre-GST Post-GST 1. Period A April,2016 to June, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e buyers. The Respondent would be eligible to avail proportionate ITC only in respect of the flats/ area sold prior to the issue of Completion Certificate on 12.02.2018. 19. The DGAP has also observed that the benefit of additional ITC of 2.42% of the amounts collected or to be collected by the Respondent from the Applicant No. 1 and other recipients as on 30.06.2017 and the new recipients who had made bookings post 01.07.2017 but prior to the issue of Completion Certificate on 12.02.2018, which had accrued to the Respondent was required to be passed on to the Applicant No. 1 and other flat buyers. He has also claimed that the Respondent appeared to have contravened the provisions of Section 171 of the CGST Act, 2017 by not passing on such benefit to the Applicant No. 1 and other recipients. The DGAP has further claimed that the profiteered amount to the tune of Rs. 15,231/- pertained to the Applicant No. 1 which included both the profiteered amount @ 2.42% of the base price and 12% GST on the said profiteered amount. The DGAP has also contended that the profiteered amount to the tune of Rs. 3,69,11,732/- [Rs. 3,69,26,963/(-) Rs. 15,231/-] was realised by the Respondent from the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enefit should be computed to calculate the profiteered amount. He has further stated that in case of a real estate development company, there were multiple kinds of inputs some of which were eligible for ITC in the pre-GST regime, however post-GST, while many of the indirect taxes had been subsumed and ITC was available on inputs, there were constraints/conditions on utilizing the ITC especially when any excess ITC was not available as a refund. 25. also submitted that it was very difficult to calculate the ITC especially in respect of the pre-GST period as in the real estate business, while inputs were used and credit of ITC was available throughout the construction/development cycle, the sale/booking, demand and collection was not directly linked or in any way pro-rated to the actual development/construction. He has further submitted that the DGAP in Table C of his Report dated 02.04.2019 had calculated the ratio of CENVAT/ITC to turnover by dividing the area of those units where some payments had been collected during the period from 01.04.2016 to 30.06.2017 by the total saleable area of the project, but, the project also had some units which were sold prior to 01.04.2016 again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into force on 01.07.2017 and there was very little tax rate/ITC benefit which he had got as a result of the introduction of the GST. But still, he had given GST benefit of Rs. 7,97,97,359/- suo-moto to his customers including the Applicant No. 1, as a goodwill gesture before the filing of the complaint by the Applicant No. 1. 30. also submitted the summarized position of the GST benefit as calculated by the DGAP and what was passed on by him as under:- GST Benefit calculated by DGAP GST Benefit Passed on by the Respondent Excess benefit passed on 3,69,26,963 7,97,97,359 4,28,70,396 He has also contended that he has passed on an amount of Rs. 7,97,97,359/- as GST benefit to his customers, while the amount of total ITC claimed by him during the GST period was only Rs. 7,05,83,085/-, thus, he had passed on an amount which was even more than the total ITC. 31 The Respondent has also mentioned that there were specific cases, which might have different parameters and hence might not fall in the standard parameters which had been applied by the DGAP while framing his Report such as:- i) The Respondent had in August 2017 come out with an offer whereby discount was offered spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed on Excess/ (short) benefit passed on to Customers Benefit Due, Short passed 12 4,39,83,830 1,64,57,740 5,69,828 4,46,071 2,18,561 (2,27,510) Benefit Due, Excess passed 56 16,04,85,817 1,18,84,346 14,96,420 3,22,116 6,12,499 2,90,383 He has also submitted that in the above table, the recalculation was done on account of actual amount of instalments falling due post introduction of GST. v) In 400 cases with the sale value of Rs. 102,42,13,734/-, where the DGAP had not calculated any benefit to be passed on, nor had he passed on any benefit in such cases. 32. He has also summarised his above 5 specific cases in the table given below:- Details Basis Discount on account of GST Excess GST passed on No benefit passed on GST benefit passed on No benefit due Total (Rs.) Benefit due Benefit not due Benefit Due, Short passed Benefit Due, Excess Total no. of units 26 972 11 80 56 12 400 1557 Sale Value of units A 114,872,819 3654,467,283 36,490,365 213,247,473 160,485,817 43,983,830 1024,213,734 5247,761,321 Amount collected prior to GST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,260,389 He has claimed that post above adjustment, an amount of Rs. 92,60,389/- was to be reversed, but, he had already passed on excess benefit on account of GST to his customers aggregating to Rs. 4,57,23,954/- thus, the reversible amount should be considered part of the excess benefit passed on and any fresh reversal of ITC should not be insisted upon. The Respondent has also furnished the list of homebuyers along with the GST benefit passed on to them. 35. During the course of hearing, the Applicant No. 1 has also filed written submissions dated 07.05.2019 vide which he has raised the following issues:- (a) Being a composite supply/works contract, the Respondent should have charged GST @ 12% as compared to 18%. (b) The Respondent had charged 18% GST on the labour cess which was also tax and hence no tax could be charged on the tax. (c) The Respondent had charged Rs. 5806/- as CGST & SGST @ 18% on the annual maintenance charges which amounted to Rs. 2,688/per month, however, the maintenance charges upto Rs. 7,500/- per month had been exempted from the GST. 36. The Respondent has also filed written submissions dated 07.06.2019 vide which he had submitted the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been exempted from the GST was also incorrect since, as per the Notification No. 12/2017 - Central Tax (Rate) dated 28.06.2018 and No. 2/2018 dated 25.01.2018 they exempted such charges only when charged by an unincorporated body or a non- profit entity registered under any law, to its own members. In the instant case, till such time the RWA was registered, he continued to provide these services to the residents which could not be categorised as services by an unincorporated body or non-profit entity. Hence, such services were covered by the GST and he had correctly charged GST on such charges. 42. The Respondent has also filed written submissions dated 24.06.2019 vide which he has submitted that during the hearing held on 11.06.2019, the Applicant No. 1 was asked to explain his claim/calculation of GST benefit of Rs. 68,179/- and it was found that his claim was primarily based on difference in the rate of Service Tax applicable prior to the introduction of the GST and the rate of GST applicable post its introduction, as was given below (extract from the Applicant No. 1's claim - Annexure 1 to the DGAP's Report):- Particulars Basic Amount (without tax) (a) Service Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re already submitted Total 1557 36,926,971 79,797,359 45,723,954 402,017 45. He has also mentioned that since he had passed on the GST benefit which was more than what the DGAP had calculated, thus this Authority may pass an order confirming his above claim, so that he could immediately pass on the benefit short/not passed of Rs. 4,02,017/- to the 21 flat buyers. 46. The Applicant No. 1 has also filed written submissions dated 21.06.2019 vide which he has submitted that as per the DGAP's Report dated 02.04.2019, the ITC availed post GST pertaining to sold units had been calculated as Rs. 6, and the ITC available for the period between July 2017 till August 2018 by the Respondent was Rs. 7,05,83,085/-. Further, the DGAP had himself admitted that till March 2019 the Respondent had not submitted the GSTR-1 and GSTR-3B returns for the period from April 2018 to August 2018. He has further claimed that as the GSTR-3B returns for the period from July 2017 till March 2018 were provided to the DGAP, the ITC figures as available in the GSTR-3B returns for those 9 months could only be substantiated. The Applicant No.1 has claimed that as per his calculation total ITC a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent letter for Flat No. A-1202 having total area of 1710 sq. ft. was issued by the Respondent whereby the total unit sale price of the flat was Rs. 48,38,750/-, thus, the per sq. ft. rate offered by the Respondent after GST implementation was Rs. 2,830/- which included one year maintenance and one covered car parking. The Applicant No. 1 has fufther submitted that for comparing the rates of flats offered prior to GST implementation, per sq. ft. rate was considered for his flat (Easy-301) as Rs. 3,430/- per sq. ft. without reducing the GST benefit of BSP. He has also stated that both, the one year maintenance charges and the covered car parking were not included in the per sq. ft. rate of Rs. 3,430/-. However, as the Applicant No. 1's rate was applicable for the Subvention Plan, thus the difference was adjusted towards both the items while calculating per sq. ft. rate offered before GST and after GST implementation, he has stated. Thus, while comparing both the rates, the reduction in price was 17.49% in the previous cases whereas the Respondent had offered only a reduction of Rs. 30,104/on a BSP of Rs. 5,61,936/- on possession, which was a meagre 5.35% of the BSP. The Applicant No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the customers during the period from 01.07.2017 till 20.02.2018 i.e. after the implementation of the GST till the receipt of Completion Certificate under any of the payment terms i.e. Down Payment, Subvention Scheme and Construction Linked Scheme. Thus, only the final payment at the time of offer of possession was due after the implementation of the GST from 1521 units out of the 1557 units as had been shown in Anexure18 of the DGAP's Report. He has also mentioned that while checking the balance base price recoverable after GST implementation, there were 351 categories of payment terms (ranging from 1.63%- 98.44%) offered to buyers, which were applicable at the time of possession and as per payment terms prevalent in Real Estate Sector, final instalments of 5%, 10%, 15%, 25% or 90% were payable at the time of possession. However, as per the data provided by the Respondent, different payment terms were offered to each 4th booking done by the Respondent which was incorrect. He had thus contended that instead of relying on figures of turnover/amount receivable (after GST implementation) by the Respondent, the DGAP should have relied more on the taxable output supply mentioned in GST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intimated that the Respondent had never paid his GST liability (except reverse charge) in cash but had only utilized ITC to discharge the same which meant that the Respondent had sufficient ITC from the inward supplies which was more than the tax liability which has arisen from the sale of flats and thus, post-GST, the Respondent had benefitted from additional ITC to the tune of 16.23% of the turnover on the base price of Rs. 95.98 Crores and therefore, the profiteered amount should be Rs. 15.58 Crores. 54. The Applicant No. 1 has also furnished the allotment letter and copy of the ledger of unit A-1202 provided by the Respondent and stated that all these services (claimed to be in the nature of reimbursement) were considered as part of basic cost and GST @ 12% had been charged by the Respondent, which being a case of overcharging of GST from the Applicant No. 1 may be referred to the appropriate authority for taking action against the Respondent. 55. The Applicant No. 1 has also contended that the levy of GST had been specified in Section 9 of the CGST Act, 2017 and the GST was to be levied on every supply of goods and/or services as per Section 7 read with Section 9 of the CGS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicant No, 1 has further claimed that he had stated in his complaint that the Respondent had charged GST on the Labour Cess which was already in the nature of a tax and thus charging tax on tax was a gross violation of the provisions of the CGST Act, 2017. The Respondent had quoted the definition given in Section 15 (2) of the Act mentioning that the Value of Supply shall include:- a) Any taxes, duties, cesses, fees and charges levied under any statute, other than GST b) ............................ The Applicant No. 1 has also reproduced clause 22 of the General Terms and Conditions of the Allotment Letter as under:- "THAT all taxes or charges be it, House Tax/Property tax, Water Tax, Sewer tax, Wealth Tax, Service Tax, Cesses, Levies, sales tax, Trade Tax, Metro Cess, VAT and taxes of all and any kind by whatever name called and development charges of the land of the Residential complex and any other charges whether levied or leviable now or in future imposed by GNO/DA or any other Local Authorities, state Government, Central Government or court as the case may be shall be payable and be paid by the Allottee(s). Accordingly, as per the conditions mentioned in clause 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional expenditure including Cess on which GST rate @ 18% was charged by Respondent and which was claimed as "Reimbursement" did not fall under the "said supply" category and was not chargeable to tax at all. Thus, as 'Reimbursable Expenses including Cess" were not charges for the "said service", these expenses should not have been includable for calculating the "Transactional Value". 59. The Applicant No. 1 has further contended that if the reimbursements were allowed to be charged at higher rate then even those builders who had opted for composition scheme would resort to charging GST@ 18% on such reimbursements. He has also submitted that the allotment conditions framed by the Respondent were onesided and favoured only the Respondent. He has further submitted that the Wealth Tax liability of the Respondent was also to be borne by the allottees of the residential units, similarly, the Respondent was also authorized to charge taxes of all and any kind by whatever name called e.g. income tax on the income earned from the project in the present case, Health and Education Cess on such income from the allottees. He has also stated that in the absence of any specific provision in the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present project for the period from July 2017 to August 2018, he had provided a month wise break up of the ITC, project wise to the DGAP which was also placed at Annexure-14 of the DGAP's Report dated 02.04.2019 and the amount of ITC credit for the present project was also easily verifiable from the bills/invoices. The Respondent has further stated that the fact that he had passed on GST benefit of Rs. 7,97,97,359/- was fully supported by verifiable documents and records and the GST benefit was an adjustment against input credits, not a cash benefit and while a significant portion of this benefit was a statutory obligation to pass on the additional ITC available to him the rest was result of the market conditions and an attempt to revive and urge customers to pay their dues/instalments in time. 62. The Respondent has also mentioned that he had come out with an offer in August 2017, under which discount was offered on account of GST benefit and the base price of the units was reduced by the amount of the discount in an effort to sell unsold inventory. 26 bookings were received under this offer where the aggregate GST benefit / discount was Rs. 31,12,513/- The Respondent has also i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the period from July 1, 2017 to Feb 20, 2018 and also no demand was raised on existing bookings during this period, whereas actually demands aggregating Rs. 94.22 Crores were raised during this period on existing/fresh bookings, which would completely change the above Applicant's calculations. The Respondent has also claimed that the Applicant No. I had stated that data as per the GST returns of the Respondent should have been relied upon and he had later on confirmed that the outward taxable supplies of the Respondent for the period from July 1, 2017 to March 31, 2018 matched with GSTR- 3B returns for the same period. Thus, Applicant No. 1's above claim was incorrect as there was no mismatch and the data provided by the Respondent to the DGAP and relied upon by him was authentic. He has also submitted that as per the Applicant No. 1's claim that the base price to be recovered from the buyers after implementation of the GST (Outwards Taxable Supply as per GSTR-3B and Cost Audit Report) should have been Rs. 95,98,64,556/-, was incorrect since the Applicant No. 1 had wrongly taken the outward taxable supply amount of all the ongoing projects. This amount for the project for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrect and the details of payment of GST liability from July 2017 to August 2018 have been given by him as under: Period GST Liability (Rs. in cr.) RCM Liability (Rs. in cr.) Paid through ITC/Cenvat (Rs. in cr.) Paid through Cash (Rs. in cr.) July-17 to August-18 23.21 1.38 20.85 3.74 The Respondent has also enclosed the copies of the Letter of Allotment / Letter of Offer of Possession and the buyer's Ledgers in five cases, as a representative sample to show evidence of passing on the GST benefit to his customers. 65. The Applicant No. 1 has also filed written submissions on 09.07.2019 vide which he has reiterated his previous submissions 66. Clarification was also sought from the DGAP on the Respondent's and Applicant No.1's submissions. The DGAP vide his Report dated 09 07.2019 has submitted that the calculation of the profiteered amount made by the Applicant No. 1 was based on the figures contained in the GSTR-3B returns filed by the Respondent for the period from July, 2017 to March, 2018. However, the period covered by the DGAP during the investigation was from July, 2017 to August, 2018. He has further submitted that as the turnover and the ITC pertaining to more ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of Section 171 (1) of the CGST Act, 2017 and accordingly action should be taken against him. This complaint was forwarded by the above Committee to the Standing Committee on Anti-Profiteering which had examined it on 06.09.2018 and sent it to the DGAP for detailed investigation. It is further revealed that the DGAP after collecting necessary information/documents from the Respondent vide his Report dated 02.04.2019 has stated that the Applicant No. 1 had booked a flat with the Respondent on 28.03.2016 for a total consideration of Rs. 42,16,941/- which was to be paid in instalments as has been shown in Table A of his Report. It is also apparent from the Report that the Respondent had availed CENVAT credit of Rs. 2,45,78,509/- during the Pre-GST period from April 2016 to June 2017 and ITC benefit of Rs. 6,10,40,252 during the Post-GST period from July 2017 till the date of issue of the Completion Certificate of the project which was received by the Respondent on 12.02.2018 from the GNIDA. The DGAP as per Table C has also calculated the ratio of the CENVAT credit by taking in to account the turnover of the Respondent during the Pre-GST period from April 2016 to June, 2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aimed that he had passed an amount of Rs. 33, 176/- as benefit of ITC to the Applicant No. 1 at the time of demand of the final instalment on 27.02.2018. However, perusal of the ledger account of the above Applicant shows that an entry has been made on 01.04.2018 in his account as "Receipt Ref: CNEM/00003/18-19 (30,104.00+Tax 3,612.00) which does not mention that this amount has been credited on account of benefit of ITC. The Respondent has also not explained how this amount has been calculated and produced any evidence to prove that this amount was released on account of the ITC benefit and hence the same cannot be construed to have been passed on account of the ITC benefit and therefore, this contention of the Respondent cannot be accepted. 72. The Respondent has further claimed that he has passed on Rs. 7,97,97,359/- as GST benefit to his customers, while the amount of total ITC claimed by him during the GST period was only Rs. 7,05,83,085/- and thus, he had passed on an amount which was even more than the total ITC. He has also stated that the DGAP had calculated the profiteered amount as Rs. 3,69,26,963/- whereas he had passed the above amount which was more by Rs. 4,28,70,39 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had given the benefit on account of the additional ITC which had accrued to him after introduction of the GST. There is also evidence on record which suggests that he had given different discounts to different set of buyers which also leads to the conclusion that these discounts did not pertain to the benefit of ITC as this benefit was required to be distributed by taking in to account the value of the instalments which were due from the individual house buyer post 01.07 2017. 74. The Respondent has also submitted that an amount of Rs. 92,60,389/- was required to be reversed on account of unsold area instead of Rs. 95,42,833/- calculated by the DGAP as an amount of Rs. was directly related to services on the sold units. However, no evidence has been produced by the Respondent to substantiate his claim and hence the same cannot be admitted and the amount calculated by the DGAP has to be accepted to be correct. The reversed amount can also not be considered as the excess benefit and adjusted against the ITC benefit as it has to be credited to the Central as well as the concerned State Govt. 75. The Respondent has also claimed that he had taken single registration for all his five ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent house buyers. This claim of the above Applicant is not tenable as the Respondent is entitled to charge the above taxes in case they form part of the agreement which had been duly executed by the allottees voluntarily. There is no evidence on record that the Respondent had framed different terms of allotment for different allottees and hence. the contention of the above Applicant made in this regard cannot be accepted. The above Applicant had also complained that the Respondent had not given him possession of the flat which has been done now and hence his grievance has been settled. 78. The above Applicant has also submitted that the total ITC available to the Respondent was Rs. 18,48,54,490/- during the Post-GST period out of which he had utilised an amount of Rs. 16,75,60,750/- till March, 2019 whereas the DGAP had calculated it to be Rs. 6,10,40,252/- only. A Report was called from the DGAP on this claim and the DGAP vide his Report dated 09.07.2019 has submitted that the above Applicant had taken in to account the ITC pertaining to all the five projects which were registered against the single registration obtained by the Respondent. He has also clarified that he had tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .01/per sq. ft. to Rs. 17.16% due to price reduction of the inputs and the Respondent was also availing benefit of 7% of GST rate as the same was increased from 5% to 12% and therefore, he was discharging his entire output tax liability from the ITC as he had benefit to the extent of 16.23% from the additional ITC. However, this argument of the Applicant cannot be relied upon in the absence of any cogent calculation of the effect of the price reduction due to implementation of the GST. The record also shows that the Respondent had paid an amount of Rs. 3.74 Crore in cash on account of his output liability of GST. Therefore, the contentions made by the above Applicant in this para are irrelevant. 83. The Applicant No. 1's contention is that the Respondent had benefitted from additional ITC to the tune of 16.23% of the turnover and on the base price of Rs. 95.98 Crores and thus, the profiteered amount should be Rs. 15.58 Crores. But this contention is incorrect since the DGAP vide his Report dated 09.07.2019 has clearly stated that the profiteered amount computed by the Applicant No. 1 was based on the figures contained in the GSTR-3B returns filed by the Respondent for the period f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the payment is made, in terms of Rule 133 (3) (b) of the above Rules. This Authority under Rule 133 (3) (a) of the CGST Rules, 2017 further orders that the Respondent shall reduce the prices to be realized from the buyers of the flats commensurate with the benefit of ITC received by him as has been detailed above. 87. It is also evident from the above discussion that the Respondent has denied benefit of ITC to the buyers of the flats being constructed by him in his present project and resorted to profiteering in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has thus he has apparently committed an offence under section 171 (3 A) of the CGST Act, 2017 and therefore, he is liable for imposition of penalty under the provisions of the above Section. Accordingly, a Show Cause Notice be issued to him directing him to explain as to why the penalty prescribed under Section 171 (3 A) of the above Act read with Rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him. 88. The Authority as per Rule 136 of the CGST Rules 2017 directs the Commissioners of CGST/SGST Uttar Pradesh to monitor this order under the supervision of the DGAP by ensuring tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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