2023 (4) TMI 422 - HC - GST

Profiteering - allegation is that petitioner has not passed the Input Tax Credit (ITC) on the supply of construction services to the flat buyers - violation of Section 171 of the Central Goods and Services Tax Act, 2017 (CGST Act) - HELD THAT - Learned Counsel for the petitioner state that in matters where the constitutional validity of Section 171 of the CGST Act and Rule 122 of the CGST Rules have been challenged, a coordinate Bench of this Court has passed interim orders, staying the penalty and interest and restraining further investigations in respect to other projects of the petitioners. The respondents are restrained from conducting any further investigation into other projects that has been suo motu ordered by Respondent no. 3. There shall also be a stay on the penalty and interest as demanded. List on 29.08.2023.

Summary

Issues involved: Impugning an order by National Anti-Profiteering Authority u/s 171 of CGST Act regarding profiteering in passing Input Tax Credit on construction services to flat buyers.

Summary:
The petitioner challenged an order by the National Anti-Profiteering Authority alleging profiteering by not passing on Input Tax Credit (ITC) to flat buyers. The Authority determined an additional amount realized by the petitioner and held it guilty of profiteering. The petitioner disputed the methodology used for quantification, claiming that only 90 out of 535 flat buyers responded confirming the benefit transfer. The petitioner argued that the methodology was arbitrary and lacked confirmation from all flat buyers. The Court issued notice to the respondents, and the petitioner cited interim orders from previous cases staying penalties and investigations related to similar challenges to Section 171 of the CGST Act and Rule 122 of the CGST Rules. Consequently, the respondents were restrained from further investigations and penalties, with a stay on demanded penalty and interest. The matter was listed for further proceedings on 29.08.2023.