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2023 (8) TMI 338 - CCI - GSTProfiteering - project Bhagwati Eminence - benefit of ITC was not passed on to the recipients by way of commensurate reduction in the prices or not - contravention of section 171 of CGST Act - HELD THAT - This Commission has carefully considered the Report of the DGAP and the other material placed on record and finds that the DGAP, in pursuance to the Order No. 68/2022 dated 02.09.2022, has investigated the matter pertaining to the other projects executed by the Respondent in terms of Section 171 of the CGST Act, 2017 and the Rules made thereunder, so as to determine whether there had been any profiteering by the Respondent. Thereafter the DGAP has submitted that no other project has been executed by the Respondent except the project Bhagwati Eminence , profiteering in respect of which has already been determined by the NAA in BHAGWATI INFRA, 2022 (9) TMI 726 - NATIONAL ANTI-PROFITEERING AUTHORITY . The DGAP has furnished his Report dated 23.02.2023 to NAA, stating that no other projects is being executed by the Respondent and hence Respondent was not liable to pass on the benefit of Input Tax Credit and Section 171(1) of the Central Goods and Services Tax Act, 2017 requiring that any reduction in the rate of tax on any supply of goods or services or the benefit of the input tax credit shall be passed on to the recipient by way of commensurate reduction in prices , is not applicable in the present case. This Commission finds that the provisions of Section 171 (1) of the CGST Act, 2017 are not attracted in the case of other projects of the Respondent and therefore the present proceedings are hereby dropped.
Issues involved:
The issues involved in this legal judgment include profiteering by the Respondent in relation to the 'Bhagwati Eminence' project, determination of profiteered amount, investigation of profiteering in other projects executed by the Respondent, verification of the Respondent's claim regarding projects other than 'Bhagwati Eminence', and applicability of Section 171(1) of the CGST Act, 2017. Profiteering in 'Bhagwati Eminence' Project: The DGAP's initial investigation revealed that the Respondent had profiteered an amount of Rs. 1,56,77,149 while executing the 'Bhagwati Eminence' project, which was required to be passed on to the home-buyers. The NAA determined this profiteered amount and directed the Respondent to pass on the benefit as per the provisions of Section 171 of the CGST Act, 2017. Investigation of Other Projects: Following the NAA's order, the DGAP was directed to investigate profiteering in relation to projects other than 'Bhagwati Eminence' executed by the Respondent. The DGAP conducted an investigation covering the period from 01.07.2017 to 31.08.2022 and sought information from the Respondent regarding the passing on of Input Tax Credit (ITC) benefits to customers of other projects. Verification of Respondent's Claim: The Respondent claimed that no other projects besides 'Bhagwati Eminence' had been started, thereby asserting that there was no benefit of ITC to be passed on to customers. The DGAP verified this claim by checking the Maharashtra RERA website, which confirmed that no other project of the Respondent was registered. Additionally, the jurisdictional Commissionerate confirmed that the Respondent had not executed any other project. Applicability of Section 171(1) of CGST Act, 2017: Based on the investigation and verification, the DGAP concluded that the Respondent had not undertaken any other construction project apart from 'Bhagwati Eminence'. Consequently, the provision of Section 171(1) of the CGST Act, 2017, requiring the passing on of tax benefits to recipients, was deemed not applicable in this case. Conclusion: After careful consideration of the DGAP's report and supporting evidence, the Commission found that no other projects had been executed by the Respondent, and therefore, the provisions of Section 171(1) of the CGST Act, 2017, were not attracted. As a result, the present proceedings were dropped, and the order was communicated to the Respondent and the DGAP.
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