TMI Blog2022 (6) TMI 1165X X X X Extracts X X X X X X X X Extracts X X X X ..... the post-GST period (July-2017 to December-2018), it was 5.65% for the project 'Sports Vile'. This confirms that, post-GST, the Respondent has been benefited from additional ITC to the tune of 3.31% (5.65% - 2.34%) of his turnover for the project 'Sports Ville' and the same was required to be passed on to the customers/ home/shop buyers. The DGAP has calculated the amount of ITC benefit to be passed on to all the flat buyers as Rs. 1,42,45,741/- for the project Sports Ville' which was availed by the Respondent. The Respondent has not disputed the findings of the DGAP regarding method of computation of profiteering and the amount worked out by him. As such, the Authority finds no reason to differ from the above-detailed computation of profiteering in the DGAP's Report or the methodology adopted and hence, the Authority determines the profiteered amount for the period from 01.07.2017 to 31.12.2018, in the instant case, as Rs. 1,42,45,741/-, for the project 'Sports Ville'. Interest - HELD THAT:- The Authority directs the concerned jurisdictional CGST/SGST Commissioner to ensure that such amounts are returned/passed on/ refunded along with inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17. The brief facts of the case are that the Applicant No. 1 filed an application dated 19.09.2018, before the National Anti-profiteering Authority (Authority) under Rule 128 (1) of the CGST Rules, 2017 alleging profiteering by the Respondent in respect of purchase of Flats in his Sports Ville project located in Sector-2 35, Sohna, Gurgaon. The above Applicant No. 1 also alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) availed by him by way of commensurate reduction in the price of the above flats. The said application was forwarded by this Authority to the Standing Committee on Anti-profiteering for further necessary action. The aforesaid application was considered by the Standing Committee on Anti-profiteering, in its meeting held on 27th December, 2018, wherein it was decided to forward the same to the DGAP to conduct detailed investigation in to the complaint according to Rule 129 (1) of the CGST Rules, 2017. The DGAP has covered the period from 01.07.2017 to 31.12.2018 for the investigation and relevant documents were called from the Respondent. From the data submitted by the Respondent for the period April, 2016 to December, 2018, the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,21,44,569 Ratio of Input Tax Credit of Turnover (J)=(I)1(F)*100 2.34% 5.65% The DGAP has observed from the Table-A' above that the ITC as a percentage of the total turnover that was available to the Respondent during the pre-GST period (April, 2016 to June, 2017) was 2.34% and during the post-GST period (July, 2017 to December, 2018), it was 5.65%, which confirmed that, post-GST, the Respondent has been benefited from additional ITC to the tune of 3.31% [5.65% (-) 2.34%] of the turnover. 2. Accordingly, on the basis of the figures contained in Table-A' above, the comparative figures of the ratio of input tax credits availed/available to the turnover in the pre-GST and post-GST periods as well as the turnover, the recalibrated base price and the excess realization (profiteering) during the post-GST period, were tabulated by the DGAP as has been given in Table below:- Table-`B' (Amount in Rs.) Sr. No. Particulars Post-GST 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to Rs.1,42,45,741/- which included GST (@ as applicable) on the base amount of Rs. 1,29,68,303/-. Out of the total profiteered amount of Rs.1,42,45,741/-, the Respondent has realised additional amount of Rs. 70,728/- from the Applicant No. 1, inclusive of GST. 3. The DGAP vide Table-'D' of his Report dated 02.07.2019, had reported that the Respondent had claimed to have already passed on benefit of Rs. 1,42,56,347/- to his home buyers during the period from 01.07.2017 to 31.12.2018. 4. The above said Report dated 02.07.2019 was forwarded to the Respondent and after hearing the matter with the Respondent, the Authority vide it Interim Order No. 04/2020 dated 03.01.2020 directed the DGAP to verify the amount of ITC benefit claimed to have been passed on to the home buyers by the Respondent as per the provisions of Rule 133 (4) of the CGST Rule, 2017 and submit his Report clearly mentioning the verified amount of benefit passed on by the Respondent to his home buyers and the balance amount still to be passed on to each of the home buyers. 5. Accordingly, the DGAP submitted his report on 30.09.2020 under Rule 133 (4) of the CGST Rules, 2017, inter alia, stating:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Respondent had claimed to pass on the benefit of additional ITC than the actual amount. In some cases, the benefit of ITC passed on was less than the amount that should have been passed on. A summary of category-wise ITC benefit required to be passed on (profiteering amount as per Report dated 02.07.2019) and the benefit claimed to be passed on by the Respondent, have been furnished by the DGAP in Table-'C' below: - Table-C Sr.No. Category of Customers No. of Units Profiteering Amount (as per Report dated 02.07.2019) Benefit Passed on as claimed by the Respondent Excess/ Short Benefit passed on Remark A B C D E F=D-E G 1. Home Buyers 709 1,10,81,235 1,32,02,446 (21,21,211) Details as per Annex-10 2. Home Buyers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Remarks A B C D E F 1 14 2,90,788 3,85,064 2,44,249 Excess amount received 2 1 20,776 17,449 17,449 Same amount received 3 4 83,072 82690 2,76,270 Less amount received 4 1 20,776 30,360 17,444 Benefit to be passed on at the time of conveyance deed. From the above table, it could be seen that the Respondent's claim of passing on of benefit was not in consonance with the acknowledgement receipts. It appeared that the Respondent had passed on the benefit of ITC amounting to Rs, 2,61,698/- (Column-El + E2) to 15 home buyers (mentioned at S. No. 1 2). The Respondent had passed on less benefit to 04 ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 171 should not be fixed. The Respondent was directed to file written submissions which have been filed on 24.11.2020 in which the Respondent has submitted:- a. That the Respondent had submitted the complete payment details of the benefit of ITC passed on to his customers, which had been accepted by this Authority. b. That in furtherance of his submissions of Input Credit payment details, vide his letter dated 11.07.2020, the Respondent had submitted that Acknowledgement copies of all home buyers to whom the benefit of ITC passed on by HCBS would take time of not less than next 3-6 months. c. That the Respondent had received more than 85 acknowledgements from customers. d. That the Respondent did not agree with the Report dated 30.09.2020 as he had adjusted the benefits passed on to the customers. He had explained the same to all such customers who had come to take no-dues and possession. All such passed on GST benefits were documented and any such Customer denying benefit was either unaware of the same or not making correct submissions. e. That if this Authority directed him to submit acknowledgements from any random customers, he was ready to submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent that he had passed on the benefit of ITC to his home buyers on the basis of random sample of 10% of the total buyers selected by this Authority and the acknowledgements received from the said selected buyers. b. That he was ready to furnish the acknowledgements from randomly selected sample of buyers as evidence of passing on of ITC benefit as per the requirement of this Authority. Therefore, the Respondent further requested to select the random sample of buyers as per precedence and give him a chance to submit the acknowledgements/receipts from those selected buyers. 10. In view of the above request of the Respondent, the DGAP was directed to verify the claim of the Respondent that he had passed on ITC benefit in respect of 71 specified customers/ home/shop buyers selected randomly from the total 762. 11. The DGAP vide letter dated 01.03.2021 has submitted his interim verification Report stating that:- a. Out of the list of 71 home buyers, 3 names had been repeated. Of the remaining home buyers, email addresses of 39 home buyers were not available. Vide email dated 04.02.2021, the Respondent was requested to provide email addresses of those 39 home buyers. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6347/- to his flat buyers/customers. b. That he was in receipt of the DGAP's verification Report dated 01.03.2021, wherein two lists of home buyers of Respondent had been attached. The first list contained the names of 32 homebuyers out of 71 home buyers randomly selected by this Authority. All these 32 home buyers had stated and accepted that they had received the benefit of GST from the Respondent as was evident and clear from last column of the said list of 32 home buyers. This list substantiated that contention of the Respondent that he had passed the benefit of GST to all his home buyers. c. That regarding second list of 30 names of home buyers who were not in the list of 71 home buyers selected by this Authority but responded as per previous e-mails of the DGAP, the Respondent submitted that he has credited the GST benefit in the account/ledger of each such buyers maintained by the Respondent. Copies of account/ledgers of all the 30 home buyers were enclosed with these submissions. From a perusal of all these ledgers of 30 home buyers, it was clear that the Respondent had credited the GST benefit to all these buyers also in their accounts maintained by the Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 14.12.2020, 25.01.2021, 01.03.2021 and 18.04.2022. 18. We have carefully considered the Reports filed by the DGAP, all the submissions and the documents placed on record, and the arguments advanced by the Respondent. 19. We find that Section 171 (1) of the CGST Act, 2017 deals with two situations:- One relating to the passing on the benefit of reduction in the rate of tax and the second pertaining to the passing on the benefit of the ITC. On the issue of reduction in the tax rate, it is apparent from the DGAP's Report that there has been no reduction in the rate of tax in the post GST period; hence the only issue to be examined is as to whether there was any net benefit of ITC with the introduction of GST. On this issue it has been revealed from the DGAP's Report that the ITC as a percentage of the turnover that was available to the Respondent during the pre-GST period (April-2016 to June-2017) was 2.34% and during the post-GST period (July-2017 to December-2018), it was 5.65% for the project 'Sports Vile'. This confirms that, post-GST, the Respondent has been benefited from additional ITC to the tune of 3.31% (5.65% - 2.34%) of his turnover for the project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed that they had not received any amount from the Respondent. The Authority finds that verification by means of email is not conclusive proof of passing of the benefits. The email can be created/generated by any person, which may or may not belong to the home buyer. The Authority finds that the conclusive proof of passing the benefits are only through accounts like credit note, refund of amount as reflected in bank account or reduction in price as reflected in invoice. Since no such evidence has been produced by the Respondent his claim of having passed on the benefit is not tenable and hence it cannot be accepted. 25. The complete list of eligible customers/ home/shop buyers along with Unit number and the profiteered amount due to be returned/passed on/ refunded to each of them is annexed as Annexure 'A' to this Order. 26. Therefore, the Authority directs the concerned jurisdictional CGST/SGST Commissioner to ensure that such amounts are returned/passed on/ refunded along with interest as prescribed under Rule 133 (3) (c) of the CGST Rules, 2017 to each customers/ home/shop buyers by the Respondent, if not already paid. As observed by the Authority, the conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the concerned homebuyers can claim the benefit of ITC if not passed on. Customers/ home/shop buyers may also be informed that the detailed NAA Order is available on Authority's website www.naa.gov.in. Contact details of concerned Jurisdictional CGST/SGST Commissioner may also be advertised through the said advertisement. A copy of the advertisement should also be sent to this office. 31. The concerned jurisdictional CGST/SGST Commissioner shall also submit a Report regarding compliance of this order to this Authority and the DGAP within a period of 4 months from the date of receipt of this order. 32. Further, the Hon'ble Supreme Court, vide its Order dated 23.03.2020 in Suo Moto Writ Petition (C) no. 3/2020, while taking suo-moto cognizance of the situation arising on account of Covid-19 pandemic, has extended the period of limitation prescribed under general law of limitation or any other special laws (both Central and State) including those prescribed under Rule 133 (1) of the CGST Rules, 2017, as is clear from the said Order which states as follows:- A period of limitation in all such proceedings, irrespective of the limitation prescribed under the general ..... X X X X Extracts X X X X X X X X Extracts X X X X
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