TaxTMI 
TaxTMI 
2022 (4) TMI 629
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....surate reduction in the price of the apartment purchased by him. The above application was examined by the Maharashtra State Screening Committee on Anti-Profiteering in its meeting and it prima-facie observed that it was a case of profiteering by the Respondent in terms of Section 171 of the CGST Act, 2017 and had forwarded the above application with its recommendation to the Standing Committee on Anti-profiteering for further action, as per the provisions of Rule 128 of the CGST Rules, 2017. 2. The DGAP has further reported that the Standing Committee on Anti-profiteering examined the above application in its meeting held on 13.09.2019 and decided to forward the same to the DGAP for detailed investigation under Rule 129 (1) of the CGST Rules, 2017. The DGAP had received the minutes of the meeting of the Standing Committee on Anti-Profiteering on 09.10.2019. 3. Thereafter, the DGAP had issued a notice to the Respondent on 21.10.2019 under Rule 129(3) of the above Rules, calling upon the Respondent to reply as to whether he admitted that the benefit of ITC had not been passed on to the Applicant No. 1 by way of commensurate reduction in price with respect to the project mentio....
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....17. (e) Payment receipt at the time of application for RERA registration dated 04.01.2018. (f) Details of flat bookings in the project Primo from February, 2018 to September, 2019 and the reconciliation of the same with the turnover reported in the GSTR-3B filed by the Respondent. The DGAP has noticed from this sheet that the first booking was done in the month of February 2018. (g) Intimation that Lodha Parel project was being marketed as Lodha Primo. (h) Sample copies of Demand letters cum tax invoices raised in the project were provided. 6. The DGAP has further mentioned that the Respondent had submitted that anti-profiteering provisions could not be applied to the project "Lodha Primo" as the project was not in existence before the implementation of GST and was launched in the GST regime. The Respondent had also stated that he had obtained the registration for the project "Lodha Primo" under the regulations of Maharashtra Real Estate (Regulation and Development) Act, 2016 in the month of January, 2018. In terms of the provisions of the RERA Act, bookings in the project could not happen till the registration was obtained and the Respondent ....
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....d one pays in advance in March 2019 itself. So the Applicant No.1 had money lying with Respondent as advance and the Respondent has assured that he would give 7% benefit towards March 2019 demand and he further made advance payments for 4% benefit, However, when GST council had announced that under construction property could continue to charge 12%, the Respondent went back on his scheme and said he could not give 7% benefit on the amount which was already lying with him and for future payments the Respondent has paid him 7%. In all, the above Applicant had lost approx. Rs. 1.8 Lacs. The Respondent has also sold flats at rate of 5%. c) He had booked a under construction house with the Respondent in the project called Lodha Primo located in Parel, Sewri. At the time of booking, he was verbally told that Input Tax Credit benefit for the project would be calculated and approx. @ 4-5% of ITC benefit would be passed on to him at the time of giving the possession. So he went ahead with the registration process of the property. d) In the 1st week of February 2019, when the above Applicant had enquired about the ITC benefit, he was again told over the phone that 4-5% bene....
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.... 5% with a condition of non-availability of ITC, with effect from 01.04.2019. In the present case, the Respondent chose the former option for his impugned project, "Lodha Primo" and continued to pay the GST at the old rate of 12% (with ITC). Therefore, the above Notification has no impact and is not applicable on the present proceedings. The DGAP has further asserted that in the absence of pre-GST tax rate or input tax credit structure that could be compared with the post-GST tax rate and input tax credit, the profiteering could not be computed. d) On the basis of the home buyers' list submitted by the Respondent, the DGAP has observed that the bookings for the impugned project started from February, 2018. i.e. post GST launch and the Applicant No. 1 himself had booked apartment on 20.02.2018. The above Applicant's submissions were not incorporated in the DGAP's Report dated 04.03.2020 inadvertently. However, there would be no change in conclusion of the DGAP's Report dated 04.03.2020. 10. Meanwhile, this Authority has also supplied a copy of the DGAP's Report to the Standing Committee on Anti-Profiteering and the Maharashtra State Screening Committe....
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....nd various submissions placed on record. The issues to be decided by the Authority are as under:- 1) Whether there was any violation of the provisions of Section 171 of the CGST Act, 2017 in this case? 2) If yes, then what was the quantum of profiteering? 14. A perusal of Section 171 of the CGST Act shows that it provides as under:- (1). "Any reduction in rate of tax on any supply of goods or services or the benefit of ITC shall be passed on to the recipient by way of commensurate reduction in prices." 15. It is clear from a plain reading of Section 171 (1) mentioned above that it 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 (introduced from 1.7.2017) period since the Respondent has continued to pay on the "Construction Services" at the effective rate of 12% with ITC. Hence, the only issue to be examined is whether there was any net benefit of ITC with the introduction of GST.....
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....der Rule 129 (6) of the above Rules. Since, the present Report has been received by this Authority on 05.03.2020 the order was to be passed on or before 04.09.2020. However, due to prevalent pandemic of COVID-19 in the Country this order could not be passed on or before the above date. In this regard it would be relevant to mention that the Hon'ble Supreme Court in Miscellaneous Application No 21 of 2022 in MA 665 of 2021 vide its Order dated 10.1.2022 has directed that:- "I. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.032021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings. II. Consequently, the balance period of limitation remaining as on 03.102021, if any, shall become available with effect from 01.03.2022. III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall h....