TaxTMI 
TaxTMI 
2019 (12) TMI 219
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....rofiteering under Rule 128 of the CGST Rules, 2017 on 30.10.2018. The Applicant No. 1 had stated in his application that the Respondent had resorted to profiteering in respect of supply of construction services related to purchase of Flat No. 31, GF, E-1, Premium Floor, Vatika Indian Next, Gurgaon 122004. The Applicant No. 1 had also alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) by way of commensurate reduction in the price of the apartment purchased by him, on implementation of GST w.e.f. 01.07.2017. The said application was examined by Haryana State Screening Committee and upon being prima facie satisfied that the Respondent had contravened the provisions of Section 171 of the CGST Act, 2017 forwarded the same with its recommendation to the Standing Committee on Anti-Profiteering for further action in terms of Rule 128 of the CGST Rules, 2017 on 30.10.2018. The said application was examined by the Standing Committee on Anti-Profiteering in its meeting held on 13.12.2018 and it had referred the application to the DGAP for investigation under Rule 129 (1) of the CGST Rules, 2017 to determine whether the benefit of reduction in the rate of tax o....
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....ax or the ITC on the supply of the construction service by the Respondent after implementation of the GST w.e.f. 01.07.2017 and if so, whether such benefit was passed on by the Respondent to the recipients, in terms of Section 171 of the CGST Act, 2017. 6. The DGAP in his Report has further stated that the Respondent had submitted a copy of the sale agreement dated 12.06.2012, for the sale of Flat No. 31, GF, E-1, to the Applicant No. 1 in his project "Vatika Premium Floors", measuring 1620 square feet, at the base price of Rs. 7,512/- per square feet. The details of amounts and taxes paid by the Applicant No. 1 to the Respondent, are furnished in Table-A' below:- Table- 'A' (Amount in Rs.) S.No. Payment Stages Due Date BSP Other Charges Service Tax including SBC & KKC GST GST on other charges Total 1. At the time of Booking 31-Oct-11 6,16,650 15,879 6,32,529 2. Within 60 days or Allotment (whichever is later) 15-Dec-11 12,33,300 31,757 12,65,057 3. within 90 days of booking 25-Jun-12 18,49,951 57,163 19,07,114 4. Payment due OC 10-Jul-12 2,20,000 27,192 &....
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....actions which shall be treated neither as a supply of goods nor a supply of services reads as "Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building". Further, clause (b) of Paragraph 5 of Schedule II of the Central Goods and Services Tax Act, 2017 reads as"(b) construction of a complex, building, civil structure or a pan thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier". Thus, the ITC pertaining to the residential units which were under construction but not sold was provisional ITC which may be required to be reversed by the Respondent, if such units remained unsold at the time of issue of the Completion Certificate, in terms of Section 17(2) & Section 17(3) of the Central Goods and Services Tax Act, 2017, which read as under: Section 17 (2) "Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated ....
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....o March, 2017 April, 2017 to June, 2017 Total (Pre-GST) July, 2017 to March, 2018 April, 2018 to December, 2018 Total (Post-GST) 1. CENVAT credit of Service Tax Paid on Input Services (A) 25,98,769 9,27,733 35,26,502 2. Credit of VAT on Inputs (B) 3. Total CENVAT/VAT Credit Available (C)= (A+B) 25,98,769 9,27,733 35,26,502 4. Input Tax Credit of GST (D) 3,10,249 1,66,676 4,76,925 5. Total Turnover (E) 14,84,77,976 1,16,22,676 16,01,00,652 1,75,05,307 2,43,91,208 4,18,96,515 6. Total Saleable Area of the flats in the project (in Square Feet) (F) 9,74,590 9,74,590 7. Area unsold at the time of issue of Completion Certificate (in Square Feet) (G) 3,65,592 3,65,592 8. Net Saleable Area of the flats (in Square Feet) (H) 6,08,998 6,08,998 9. Area Sold relevant to Turnover as per Home buyers list (I) 83,077 1,04,950 CENVAT/Input Tax Credit relevant to Turnover (J)= [(C) or D*(I)/(H)] 4,81,07 82,190 Ratio of CENVAT/ Input Tax Cr....
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....wani Ground Floor, 4, E-3.1, Vatika India Next, Gurugram, Premium Floors. 6292 6. Sanjay Dewan (Applicant) Ground Floor, 31, E-1, Vatika India Next, Gurugram, Premium Floors. 112080 7. Dhirendra Pratap Singh 1st Floor, 12, G-5, Vatika India Next, Gurugram, Premium Floors. 4931 8. Ritesh Vij Ground Floor, 16, E-3.1, Vatika India Next, Gurugram, Premium Floors. 93199 9. Sunii Bhalla 1st Floor, 15b, F-1, Vatika India Next, Gurugram, Premium Floors. 6212 10. Sarvesh Kumar 2nd Floor, 16, E-3.1, Vatika India Next, Gurugram, Premium Floors. 7102 11. Khem Chand Gupta Ground Floor, 17, F-1, Vatika India Next, Gurugram, Premium Floors. 8190 12. In view of the above, the Respondent vide Order dated 18.07.2019 was directed to appear before the Authority to explain why he should not be held liable to pay the benefit of ITC to the Applicant No. 1 as well as the other flat buyers along with the following documents:- a. Complete details of his Post-GST and Pre-GST ST/VAT ITC and turnover project-wise. b. Details of the total number of apartments/flats/residential units/commercial units in the project. c. Details of credit reversed, if any, in respect of units sold ....
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....ous supply. The time of supply of the deemed construction shall be the date on which invoice was required to be raised i.e. the time of reaching the milestones in terms of the Builder Buyer Agreement (BBA). f. As demand notes were raised on a limited number of customers in the GST regime, the deemed supply in the GST regime could be said to be made only to these customers. g. Since he had made supplies only to limited customers, the benefit under Section 171, if any, had to be passed only to these customers. h. That in respect of the Project-Premium Floors, he had opted for 5% rate of GST on outward supplies w.e.f 01.04.2019 as per Notification No. 11/2017-Central Tax(Rate) dated 28.06.2019 as amended by Notification No. 03/2019-Central Tax(Rate) dated 29.03.2019. i. 1% benefit was passed on to the customers on whom the demand notes had been raised in the GST regime on a provisional basis by him based on his own provisional mathematical computation. 15. Supplementary Report was called for from the DGAP on the above mentioned submissions of the Respondent under Rule 133 (2A) of the CGST Rules, 2017. The DGAP vide his Report dated 07.10.2019 has stated that the issue raised ....