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TMI Blog2022 (6) TMI 527X X X X Extracts X X X X X X X X Extracts X X X X ..... him by way of commensurate reduction in the price of Unit No. J-1804 in the Respondent's project "Roselia-2" situated at Gurugram, Haryana in terms of Section 171 of the Central Goods and Services Tax Act, 2017. ii. The aforesaid application was examined by the Standing Committee on Anti-profiteering, in its meeting, the minutes of which were received by the DGAP on 24.11.2020, whereby it was decided to forward the same to the DGAP to conduct a detailed investigation in the matter. iii. On receipt of the reference from the Standing Committee on Anti-profiteering, a Notice under Rule 129 of the Rules was issued by the DGAP on 17/18.12.2020. calling upon the Respondent to reply as to whether he admitted that the benefit of input tax credit had not been passed on to the Applicant No. 1 by way of commensurate reduction in price and if so, to suo moto determine the quantum thereof and indicate the same in his reply to the Notice as well as furnish all supporting documents. Vide the said Notice, the Respondent was also given an opportunity to inspect the non-confidential evidences/information furnished by the above Applicant during the period 28.12.2020 to 30.12.2020. However, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passing speaking order, before proceeding with the investigation. (e) The issues raised for preliminary disposal was that "Whether the Anti-profiteering proceeding can be initiated on the project where Allotment/Builder Buyers Agreement & the construction activities are made/executed in GST period'?" Without prejudice to preliminary objection, in case the DGAP, still decided to proceed with the investigation, it was requested to dispose of the above mentioned objection by passing speaking order in view of well settle law in the case of M/s GKN Driveshafts (India) Ltd. Vs. (2002) 1 SCC 72. Relevant para of the judgment is reproduced below: "However, we clarify that when a notice under Section 148 of the Income Tax Act was issued, the proper course of action for the Notice was to file return and if he so desires, to seek reasons for issuing Notice. The assessing officer was bound to furnish reasons within a reasonable time. On receipt of reasons, the Noticee was entitled to file objections to issuance of notice and the assessing officer was bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also stated that all the above said documents were confidential in terms of Rule 130 of the Central Goods and Service Tax Rules, 2017 except copies of Balance Sheet. xi. Prior to implementation of GST w.e.f. 01.07.2017, Service Tax on construction service was chargeable @ 4.50% (vide Notification No. 14/2015-ST dated 19.05.2015). However, affordable housing had been exempt from the purview of Service Tax vide Notification No. 09/2016-ST dated 01.03.2016. After implementation of GST w.e.f 01.07.2017, GST on construction services was chargeable @ 18% (effective rate was 12% in view of 1/3rd abatement on value) on construction service vide Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 and the effective GST rate on construction service in respect of affordable and low-cost houses upto a carpet area of 60 square meters was further reduced to 12% GST (effective rate was 8% in view of 1/3rd abatement on value), vide Notification No. 1/2018-Central Tax (Rate) dated 25.01.2018. xii. On scrutiny of the documents submitted by the Respondent, it was observed that the Applicant No. 1 had booked/allotted the Unit No. J-1804 on 29.07.2019 after the introduction of GST. xiii. Fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on by way of reduced price. xvi. The DGAP concluded that the anti-profiteering provisions are not applicable to the impugned project under investigation. Further, on the basis of the details of outward supply of Construction service submitted by the Respondent, it was also observed that the service was supplied in the State of Haryana only. 3. The above Report was considered by this Authority in its sitting held on 10.03.2021 and it was decided to accord opportunity to make submissions to the Applicant No. 1 by 23.03.2021 to explain why the Report dated 25.02.2021 submitted by the DGAP should not be accepted. Further opportunities were also given on 08.04.2021 27.05.2021, 15.07.2021, 10.04.2022 and 05.05.2022. However, inspite of all the opportunities no submissions were made by the Applicant No. 1. 4. The quasi-judicial proceedings in the matter could not be completed earlier by the Authority due to lack of required quorum of members in the Authority during the period 29.04.2021 till 23.02.2022, and that the minimum quorum was restored only w.e.f. 23.02.2022 and hence the matter was taken up for proceedings vide Order dated 28.03.2022 and the Applicant No. 1 was given opport ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, BBA, construction activity and receipt of payments has taken place in the post-GST era. It is also clear that the Applicant No. 1 was allotted flat only after coming in to force of the GST w.e.f. 01.07.2017 as the first tax invoice for demand cum allotment to him was raised on 29.07.2019, hence apparently there was no pre-GST tax rate or input tax credit availability that could be compared with the post-GST tax rate and the input tax credit, to determine whether there was any benefit that was required to be passed on by way of reduced price. 9. From the above facts, the Authority finds that, it is established that there had been no additional benefit of ITC to the Respondent and hence he was not required to pass on the benefit to the Applicant No. 1 by reducing the price of the flat. The Applicant No.1 could have availed the above benefit only if the above project was under execution/implementation before coming into force of the GST as the Respondent would have been eligible to avail ITC on the purchase of goods and services after 01.07.2017 on which he was not entitled to do so before the above date. Since there was no basis for comparison of ITC available before and after 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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