2026 (5) TMI 145

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....s project "Assotech Windsor Court", upon introduction of GST w.e.f. 01.07.2017, in terms of Section 171 of the Central Goods and Services Tax Act, 2017. 3. The said complaint was examined by the Standing Committee on Anti-Profiteering in its meeting held on 05.08.2019, and the minutes of the said meeting were forwarded to the Directorate General of Anti-Profiteering (hereinafter referred to as "the DGAP") for detailed investigation under Rule 129(1) of the CGST Rules, 2017. 4. The Directorate General of Anti-Profiteering (DGAP) submitted its Report dated 24.11.2025, which is delineated as under:- 4.1. The Respondent is mainly engaged in the business of Builders and Developers. They had commenced project "Assotech Windsor Court Society" and the said project comprised of 744 Units. Out of the 744 Units, 524 units were constructed pre-GST, 192 were constructed post -GST and 12 remained unsold and 16 were demolished by the Authority concerned. 4.2. The DGAP conducted an investigation for the period 01.07.2017 to 31.03.2024. 4.3. The DGAP had computed the profiteered amount by comparing the ratio of ITC to purchase value in the pre-GST and post-GST perio....

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.... shortfall in others, and in some cases no benefit has been passed. Consequently, an amount of Rs. 4,01,676/- (Rs. 1,70,865/- + Rs. 2,30,811/-), along with applicable GST of Rs. 48,201/-, remains to be passed on to the concerned homebuyers. 5. The Report was received by the Principal Bench, GSTAT on 24/26.11.2025, and a notice dated 31.12.2025 was issued to the Respondent, with intimation to the Complainant, directing the Respondent to file written submissions on the DGAP Report. 6. However, neither the Respondent nor the Complainant filed any written submissions in response to the DGAP Report. 7. Hearings in the matter were held on 09.07.2025, 23.12.2025 and 22.04.2026. Shri Achal Sharma, Chartered Accountant, and Shri Chandra Kishore Singh appeared for the Respondent. Shri Suraj Kumar Roy, Additional Assistant Director, assisted by Shri Ravi Passi, appeared for the Directorate General of Anti-Profiteering. None appeared for the original Complainant. 8. The Authorised Representative of the Respondent, during the hearing held on 22.04.2026, submitted that the Respondent is in agreement with the findings of the DGAP Report and is willing to refund the balance amount to t....

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....f ITC amounting to Rs. 5,75,26,106/- to certain homebuyers. However, as per the DGAP Report, the benefit has not been passed on uniformly, resulting in excess benefit in some cases and shortfall or nonpassing in others. Consequently, an amount of Rs. 4,01,676/-, along with applicable GST, remains to be passed on to the concerned homebuyers. Levy of GST on the Profiteering Amount: 13. With regard to the levy of GST @ 12% on the profiteered amount, it is observed that the DGAP has computed the base profiteered amount at Rs. 40,17,869/-, and thereafter added GST @ 12% amounting to Rs. 4,82,144/-, arriving at a total profiteered amount of Rs. 45,00,014/-. The computation of profiteering has been carried out on the basis of the ratio of Input Tax Credit to purchase value of goods and services, which is exclusive of GST. However, the consideration collected by the Respondent from the homebuyers is inclusive of GST. Accordingly, the amount realised by the Respondent inherently includes the GST component, and therefore, the profiteered amount is required to be returned along with the corresponding GST component. 14. In view of the above, the inclusion of GST in the profiteered amo....

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....behavior unless interest and penalty are levied to prevent such actions from taking place in the first place. The width and amplitude of Section 171 by which the authority is empowered to ensure that a reduction in tax rate or the Input Tax Credit availed results in a commensurate reduction in the price of goods or services clearly encompasses within it the power to ensure that such conduct which leads to profiteering does not take." 17. The Provisions with respect to interest are as follows:- Rule 133(3)(b) - return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with the interest at the rate of eighteen percent from the date of collection of the higher amount till the date of the return of such amount or recovery of the amount including interest not returned, as the case may be. Penalty: 18. Further, insofar as penalty under Section 171(3A) of the CGST Act, 2017 is concerned, it is observed that the said provision came into force w.e.f. 01.01.2020. In the present case, the period of investigation extends from 01.07.2017 to 31.03.2024, and therefore includes the period subsequent to the coming in....