TaxTMI 
TaxTMI 
2024 (8) TMI 1088
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.... in his project "Swastik Heights", situated at Ahmedabad, Gujarat in terms of Section 171 of the CGST Act, 2017. He also alleged that the Respondent had not passed on any benefit of ITC till date which was already received by him. He charged GST @ 8% on the base price of 25,00,000/-for the flat and promised to pass on the benefit of ITC at the same time of booking flat in Swastik Heights on 28.02.2019 but after he had received ITC he denied to pass on any benefit to the owner of flat. Respondent had opted to charge GST @ 8% from all the owners of the flats with benefit of ITC instead of opting for reduced new GST rate of 1% without ITC w.e.f. 01.04.2019. 2. The brief facts of the case and findings of investigation conducted by the DGAP are as under:- i. On receipt of the reference from the Standing Committee on Anti-profiteering on 19.04.2023, a Notice under Rule 129 of the CGST Rules, 2017 was issued by the DGAP on 24.04.2023, calling upon the Respondent to reply as to whether he admitted that the benefit of ITC and rate reduction had not been passed on to the Applicant No. 1 by way of commensurate reduction in prices and if so, to suo moto determine the quantum thereo....
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....by way of commensurate reduction in price, in terms of Section 171 of the CGST Act, 2017. v. The DGAP has found that 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). 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 (in respect of affordable and low-cost houses upto a carpet area of 60 square meters). vi. The DGAP has also observed that the land for the project "Swastik Heights" was purchased by the Respondent on 24.05.2017. The commencement certificate for the said project was issued by the Ahmedabad Urban Development Authority on 08.03.2018. As per Gujarat RERA Registra....
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....ervices or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices", is not applicable in the present case. 3. The above Report was considered by the Commission in its meeting held on 31.08.2023. Thereafter, Notice dated 31.08.2023 was served upon the Applicant No. 1 directing him to file his submissions by 21.09.2023. The Applicant No. 1 vide emails dated 12.09.2023 and 16.11.2023 has informed that GST transactions might not be done by the Respondent during pre-GST Regime (before 01.07.2017) and all transactions might be done during post-GST Regime as per DGAP's investigation but details or figures have not been provided by DGAP regarding Respondent's GST account ledger entries during post GST regime (after 01.07.2017) which could prove that there was no benefit to Respondent due to GST rate reduction from 8% to 1% w.e.f. 01.04.2019 during post-GST era. The Respondent has filed multiple GSTR 3B forms on regular basis during post GST era for claiming ITC and also charged GST @ 8% from all the flat buyers during post-GST era but details or figures regarding Respondent's total sales turnover, total GST amount charg....
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...., Inspector. The Applicant No. 1 reiterated his earlier submissions through his arguments which have been taken on record. 7. This Commission has carefully perused the DGAP's Report dated 10.08.2023 and the documents placed on record. The Commission needs to determine as to whether there was any reduction in the GST rate or the benefit of ITC and whether the benefit of rate reduction or ITC was passed on or not to the recipients as provided under Section 171 of the CGST Act, 2017. 8. It is clear from the DGAP's Report that the Respondent had started the above project in the post-GST regime as the commencement certificate was issued to him on 08.03.2018 by the Ahmedabad Urban Development Authority and the Respondent was registered under GST w.e.f.27.02.2018. As per the ITC register submitted by the Respondent, the first purchase invoice was issued on 27.02.2018. On perusal of the copies of sale agreements of all the customers submitted by the Respondent, it was found that there was no sale or even booking of the units in the above project during pre-GST regime. From the copies of payment receipts submitted by the Respondent, the DGAP has found that the first payment wa....