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TMI Blog2020 (6) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... rther realized an additional amount of ₹ 19,16,83,441/- which includes both the profiteered amount @ 8.73% of the taxable amount (base price) and 12% GST on the said profiteered amount from the 907 flat buyers other than the Applicant No. 1 and 2. The details of the profiteered amount and the buyers have been mentioned by the DGAP in Annexure-14 of his Report dated 28.10.2019. These buyers are identifiable as per the documents placed on record and therefore, the Respondent is directed to pass on the amounts of ₹ 19,16,83,441/-, ₹ 4,06,859/- and ₹ 2,85,572/- to the other flat buyers, the Applicant No. 1 and the Applicant No. 2 respectively along with the interest @ 18% per annum from the dates from which the above amounts were collected by him from them till the payment is made, within a period of 3 months from the date of passing of this order as per the details mentioned in Annexure-14 attached with the Report dated 28.10.2019. This Authority under Rule 133 (3) (a) of the CGST Rules, 2017 orders that the Respondent shall reduce the prices to be realized from the buyers of the flats of the above Project commensurate with the benefit of ITC received by him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urate reduction in the prices of the above flats. The aforesaid reference was considered by the Standing Committee on Anti-profiteering, in its meeting held on 1 1 04.2019, wherein it was decided to forward the same to the DGAP to conduct detailed investigation in to the complaint according to Rule 129 (1) of the CGST Rules, 2017. 2. The above Applicants had furnished the following documents along with their application: (a) Copies of communication between the Applicants and the Respondent. (b) Letters of offer of possession and settlement of final dues issued by the Respondent to the Applicants. (c) Copies of passports as proof of identity. (d) Duly filled in APAF forms. 3. On receipt of the recommendation from the Standing Committee on Anti-profiteering, the DGAP had found from the application filed by the Applicants that both of them had booked a flat each in the Respondent s Project Emerald Floor Select-A , on 27 09.2011 i.e. in the pre-GST era. In terms of the instalment plan agreed upon, the above Applicants were to pay the consideration in 11 instalments each linked with different stages. Prior to the coming in to force of the CST the Applicants ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Respondent had also stated that he had passed on the above computed benefit to the both the Applicants through credit notes. He has further stated that this benefit had either been passed on or would be passed on to the customers of the project Emerald Hills by way of commensurate reduction in prices due to expected additional ITC accrued to him under the GST regime. c) That the comparison of ratio of ITC to turnover for the pre-GST and the CST period would never yield the correct quantum o profiteering, if any since, the comparison was not appropriate for the reason that under the real estate there was no correlation of turnover with the cost of construction d) The Respondent vide his submission dated 30.09.2019 had submitted that the amount of profiteering as per the methodology of comparison of ratios of credit to turnover for the pre GST and the post GST period was less than the benefit already passed on to both the Applicants. e) The Respondent vide his submission dated 30.09.2019 had also submitted that without prejudice to all the above contentions as raised by him, in the absence of specified procedure and mechanism of calculation of profiteering, the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier . In the light of these provisions, the DGAP has contended that the ITC pertaining to the units which were under construction but were not sold was provisional ITC that would be required to be reversed by the Respondent, if such units would remain unsold at the time of issue of Completion Certificate (CC), in terms of Section 17 (2) Section 17 (3) of the Central Goods and Services Tax Act, 2017 which read as under:- 17 (2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. 17 (3) The value of exempt supply under sub-section (2) shall be such as may be prescribed, and shall include supplies on which the rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the supply of construction service only and had been accounted for the taxable portion only. 13. The DGAP has further submitted that the Respondent had claimed that he would pass on benefit of ITC to the tune of 5 68% to the customers and provide details of the benefit passed on. However, the Respondent had not submitted the details of the benefit passed on to the DGAP. The method of calculation used by the Respondent had also not taken into account the correct value of the ITC which was available for his project. The DGAP has further stated that in the light of the abovementioned two factors, there was no reason to admit the claim of the Respondent that he had already passed on the benefit of ITC to the home-buyers. 14. The DGAP has also stated that the had provided details of the calculations made by him and claimed that these calculations were in line with the methodology followed by the DGAP. However, the Respondent had wrongly claimed the credit of VAT and Rebate of WCT available to him. The DGAP has further stated that the turnover accounted for in the calculations of the Respondent had also included the negative values on account of cancellation of units which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claim the ITC of VAT (WCT), if it was not paid directly by him, only if, the following conditions were fulfilled:- a. Tax had been paid by his sub-contractor on the sale of goods involved in execution of the works contract. b. The assessment of such tax had become final and c. ITC of such VAT had not been availed by his sub-contractor. The DGAP has alleged that the had not submitted any evidence in this regard to substantiate his claim of ITC of WCT (VAT). Therefore, the Respondent was not eligible to claim this amount as ITC. 18. The DGAP has further informed that post-GST the Respondent could avail the ITC on GST paid on all the inputs and input services including the sub-contracts. The Respondent vide his submission dated 30.09.2019 had submitted reconciliation of turnover and CENVAT/ITC for all his projects, as in the pre-GST era, the Respondent had a centralized registration for Service Tax. In the post GST era, the GSTR Returns reflected turnover and the ITC for the whole State of Haryana and not just the impugned project. Further vide his submissions dated 30.09.2019, the Respondent had submitted the detailed calculations regarding appropriation of commo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,67,57,506 6 Total Saleable Area (F) 20,93,260 20,93,260 7 Sold Area relevant to Turnover in Sq Ft. (G) 16,91,490 1544740 8 ITC proportionate to Sold Area (H=(C or D)*G/F) 3,97,96,419 22,64,69,212 9 Ratio of Cenvat/lnput Tax Credit to Turnover(I=H/E*100) 2.78% 11.51% 20. The DGAP has argued from the Table- A that the ITC as a percentage of the total turnover that was available to the Respondent during the pre-GST period (April, 2016 to June, 2017) was 2.78% and during the post-GST period (July, 2017 to March, 2019), it was 11.51% which clearly confirmed that post-GST, the Respondent has been benefited from additional ITC to the tune of 8.73% [11 51% (-) 2.78%] of the turnover. 21. The DGAP has also argued that the Central Government, on the recommendation of the GST Council, has levied 18% GST on the construction service (after one third abatement towards v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Total demand G=E+F 2,20,27,68,407 9 Recalibrated Basic Price H=E*(1-D) or 91.27% of E 1,79,50,59,576 10 GST @ 12% I=H*12% 21,54,07,149 11 Commensurate demand price J=H+ I 2,01,04,66,725 12 Excess Collection of Demand or Profiteered Amount K=G-J 19,23,01,682 22. The DGAP has claimed from the Table- B that the additional ITC of 8.73% of the turnover should have resulted in commensurate reduction in the base prices as well as cum-tax prices of the flats. Therefore, in terms of Section 171 of the CGST Act, 2017, the benefit of additional ITC was required to be passed on to the respective recipients. 23. On the basis of the aforesaid CENVAT/ITC availability pre and post-GST and the details of the amount collected by the Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 171 of the CGST Act, 2017 inasmuch as the additional benefit of ITC @ 8.73% of the turnover (base price) received by the Respondent during the period from 01.07 2017 to 31.03.2019, has not been passed on to the above Applicants and the other recipients. On this account, the Respondent has realized an additional amount to the tune of ₹ 6,18,241/- from the Applicant No. 1 and 2 which includes both the profiteered amount @ 8.73% of the turnover (base price) and 12% GST on the said profiteered amount. The DGAP has further alleged that his investigation has revealed that the Respondent has also realized an additional amount of ₹ 19,16,83 441/- (₹ 19,23,01,682/- (-) ₹ 6,18,241/-) which includes both the profiteered amount @ 8.73% of the turnover (base price) and GST on the said profiteered amount, from the other recipients as well who were not Applicants in the present proceedings. These recipients were identifiable as per the documents provided by the Respondent giving the names and addresses along with the Unit Nos. allotted to such recipients. Therefore, this additional amount of ₹ 19,16,83,441/- was required to be returned to such eligible recipients. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mined the above complaint in its meeting held on 11.03 9019 as per the date of minutes of its meeting attached as Annexure-I to the DGAP s Report. Therefore, the period of 2 months had expired on 06.03.2019 and hence, the present proceedings were not maintainable. 29. That the Report of the DGAP has gone beyond the application submitted by the above Applicants and was liable to be rejected on this ground alone. As per Rule 128 of the CGST Rules, an anti-profiteering investigation could be initiated only on receipt of a written application from the interested party, Commissioner or any other person. In the instant case, the proceedings were started on the application received from the Applicant No. 1 and 2. Hence, the investigation could not go beyond the application and could not cover other customers who had not questioned the benefit passed on to them. In this regard, reliance was placed by the Respondent on the following cases:- 1. Dinesh Mohan Bhardwaj v. M/s. Vrandavaneshwree Automotive Private Limited 2018 VIL 01 NAA = 2018 (4) TMI 1377 - THE NATIONAL ANTI-PROFITEERING AUTHORITY . 2. Rishi Gupta v. M/s. Flipkart Internet Pvt. Ltd. 2018 VIL 04 NAA = 2018 (7) T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y based on the market driven strategy. On the contrary, the ITC accrued to a developer on the basis of the actual cost incurred by him while undertaking the development of a project. Thus, accrual of ITC was not dependent on the amount collected from the buyers. In the pre-GST regime, service were subject to Service Tax @ 15% but under the GST, in most of the cases, the said services were taxable at 18%, therefore, there was an increase of 3% in the ITC available to the Respondent which was not due to any additional benefit but due to increase in the rate of tax. 32. That the Respondent has already passed on the benefit of ITC to his customers. The essence of anti-profiteering provision was to ensure that the companies, with the introduction of GST, pass on the benefit of reduced output tax rates and increased ITC to the customers by way of commensurate reduction in the prices. The Respondent had estimated the additional benefit which would accrue to him in the Emerald Estate Project based on the above factors. Accordingly, he has passed on the benefit of 5.68% to the eligible customers of the above Project by way of reduction in prices due to expected additional ITC which wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that if the above submissions were considered, the revised profiteering calculation would be as under:- (Amount in Rs.) S.No. Particulars Apr 16 to June 17 July 17 to Mar 19 A. Cenvat Credit of Service Tax Paid on Input Services (A) 5,18,02,155 B. Rebate of VAT(WCT) paid to registered contractors of sub-contractors (B) 2,71,01,222 C. VAT Credit (C) 55,48,809 D. Total Credit [D = A+B+C] 8,44,52,166 E. ITC of GST Availed (E) 27,57,52,131 F. Total Turnover as per Home Buyers List (F) 1,43,13,26,687 1,96,67,73,977 G. Total Saleable Area (In sq. ft) (G) 20,93,260 20,93,260 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed a list of 24 (Twenty Four) other projects in which he has claimed that he had himself passed on the ITC benefit to the flat buyers. The list of the Projects is as under:- Sr.No. Project Name ITC Availment (Service Tax) during Period Apr- 16 to June -17 ITC Availment (GST) during Period July -17 to Mar-19 VAT Credit during period Apr-16 to June -17 1 Colonnade 68,98,254 9,15,96,013 - 2 Commerce Park 13,24,630 54,97,524 - 3 Digital Green 2,17,85,403 4,89,49,380 7,43,547 4 Down Town - Capital Towers 86,37,480 10,78,63,762 - 5 Emerald Estates 4,73,98,710 19,74,07,414 1,259 6 Emerald Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 24 Jaipur Greens 20,45,417 - - Grand Total 54,08,78,499 2,12,29,98,971 2,67,04,225 40 The submissions of the Respondent dated 17.12.2019 were forwarded to the DGAP for his Report. The DGAP vide his supplementary Report dated 23.01.2020 has replied on the issues raised by the Respondent as follows:- a. WCT (VAT) rebate should have been considered in calculating total credit pre-GST:- In this regard the DGAP has stated that in terms of Section 42 of Haryana VAT Act, 2003, the liability to pay tax was jointly upon the developer (Respondent) and his sub-contractor. Further, in terms of Section 24 of the Haryana VAT Act, 2003, the Government of Haryana had provided for Special provisions relating to deduction of tax at source in certain cases. The DGAP has observed that deductions claimed on account of payment to work contractors in Respondent s VAT returns submitted to his office were in compliance to Section 42 and 24 of the Haryana VAT Act, 2003 and Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt after due verification of the payment. (6) If any person fails to deduct the whole or any pan of the tax as required by or under the provisions of sub-section (1), or fails to pay the whole or any pan of the tax as required by or under subsection (3), then, the authority referred to jn sub-section (3) may, at any time within five years of the close of the year when he failed to do so, by order in writing, direct him, after giving him a reasonable opportunity of being heard, to pay, by way of penalty, a sum equal to the amount of tax which he failed to deduct or pay as aforesaid. Rule 33 (2) Every contractee shall, at the time of making payment, whether by cash, adjustment, credit to the account, recovery of dues or in any other manner, deduct from the payment made to the contractor for execution of a works contract in the State involving transfer of property in goods, whether as goods or in some other form, tax in advance calculated by multiplying the amount paid in any manner with four per cent or such other rate, as notified under sub-section (1) of section 24. Rule 33(6): The payee to whom a certificate of tax deduction and payment referred to in sub-rule ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest, etc., and not towards the basic cost of the unit. Additional ITC was available for providing the main service i.e. construction of residential complexes (SAC 440334). Therefore, turnover generated from other services as provided by the Respondent could not be accounted for in the turnover taken for calculation of profiteering. c. The Cenvat Credit of service tax paid on input services, as also ITC credit of GST availed has not factored in the correct quantum of common credit on account of corporate expenses:- In this regard, the DGAP has stated that the Report dated 28.10.2019 was signed by the DGAP on 25.10.2019. Any submission made on that day or after, had no mention in the report and no clarifications on its merit were provided. He could not verify the revised calculation of Cenvat for the pre and the post GST periods provided on 25.10.2019 and its reconciliation with the figures as were given in the statutory returns. d. The ITC credit of GST availed has not factored in the ITC reversal on account of completion/occupation certificate and ITC attributable towards plots (Exempted Services):- In this regard the DGAP has stated that the ITC credit coul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 28.10.2019. During the investigation, the Respondent has submitted that it has passed on benefit of 5.68% to its customers. However, the same was rejected by Ld. DG on frivolous grounds and by disregarding the fact of actual disbursement of GST benefit by Respondent to its customers. The Respondent submitted that the only requirement was to pass on the benefit to the customers, which the Respondent did in the present case. Thus, benefit to that extent should be extended to the Respondent. During the course of hearing before NAA also. the Respondent has substantiated the fact of actual disbursal of GST benefit, through the relevant documents, listed below - Statement of Accounts (SOAs) of eligible customers, showing credit by Respondent of GST benefit to said customers. In case, the GST benefit shown in SOA was settled by cash , the copy of Cheque , along with the bank statement of Respondent, showing debit in its account to that extent. In case, the balance of GST benefit shown in SOA was adjusted as credit in respect of some other services provided by Respondent like maintenance etc, the SOAs of said other services , showi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 3,63,267/- in respect of the Applicant No. 1 and ₹ 2,85,572/- including 12% GST on the base amount of ₹ 2,54,975/- in respect of the Applicant No. 2. He has also supplied the details of all the buyers who have purchased flats from the Respondent along with their unit numbers and the profiteered amount in respect of each buyer vide Annexure-14 attached with the Report. 43. The Respondent has also stated that the investigation carried on by the DGAP has gone beyond the application submitted by the above Applicants as it was to be limited to their benefit only and it could not cover the other customers who had not questioned the benefit passed on to them. In this regard it would be relevant to refer to the provisions of Section 171 (1) and (2) of the CGST Act, 2017 which provide 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. (2). The Central Government may, on recommendations of the Council, by notification, constitute an Authority, or empower an existing Authority constituted under any law for the time being in for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eunder. b) Responsibility for coordinating anti-profiteering work with the National Anti-profiteering Authority, the Standing Committee and the State level Screening Committees. 46. Therefore, it is apparent from the above 0M that the DGAP is charged with the responsibility to investigate and collect evidence necessary to determine whether both the above benefits have been passed on or not. No fetters have been placed either in the CGST Act, 2017 or Rule 129 of the CGST Rules, 2017 which provide that the DGAP shall restrict his investigation to the complained goods or services and he would overlook commission of an offence which has been committed in respect of the provisions of Section 171 (1) if it comes to his notice during the course of the investigation. Since, the DGAP is the investigating arm of this Authority any Report furnished by him to this Authority has to cover all the cases of denial of the above benefits once they have come to his notice keeping in view that this Authority has mandate to examine all such cases, determine the amount of benefit and provide relief to the affected buyers. The DGAP is bound to bring before this Authority all such cases in which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove Act were not attracted in the above case. Therefore, the above case cannot be relied upon. The case of Kerala State Screening Committee on Anti-Profiteering and another v. M/s. Velbon Vitrified Tiles Pvt. Ltd. decided on 01.03.2019 vide Case No. 13/2019 = 2019 (3) TMI 370 - THE NATIONAL ANTI-PROFITEERING AUTHORITY by this Authority, is also of no help to the Respondent as in this case the Respondent had passed on the benefit of tax reduction. In the case of Fx Enterprise Solutions India Pvt. Ltd. and others. v. Hyundai Motor India Limited 2017 Comp 586 (CC]) = 2017 (6) TMI 1316 - COMPETITION COMMISSION OF INDIA , the Hon ble Competition Commission of India had directed its Director General to conduct investigation on a specific issue whereas in the present case no such direction was passed by this Authority and hence the above case has no bearing on the facts of the present case and therefore, reliance cannot be placed on this case. 48. The Respondent has also claimed that Section 171 of the CGST Act 2017 or Chapter XV of the CGST Rules or the Methodology and Procedure dated 19.07.2018 issued by this Authority under Rule 126 has not prescribed the Methodology a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o his entitlement. The word commensurate mentioned in the above Sub-Section provides the extent of benefit to be passed on by way of reduction in the prices which has to be computed in respect of each product or unit or service based on the tax reduction or the additional ITC which has become available to a registered person after coming in to force of the CGST Act, 2017. Accordingly: the benefit of additional ITC would depend on the comparison of the ITC/CENVAT which was available to a builder in the pre-GST period with the ITC available to him in the post GST period w.e.f. 01.07.2017. Computation of commensurate reduction in prices is purely a mathematical exercise which is based upon the above parameters and hence it would vary from product to product or unit to unit or service to service and hence no fixed mathematical methodology can be prescribed to determine the amount of benefit which a supplier is required to pass on to a buyer. Similarly, computation of the profiteered amount is also a mathematical exercise which can be done by any mathematics or accounts knowing person. However, to further explain the legislative intent behind the above provision, this Authority has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired to carry out complex mathematical computations for passing on the benefit of ITC which he could not do in the absence of the procedure and methodology. However, his claim is absolutely incorrect as he was only required to calculate the additional ITC which has become due to him after coming in to force of the GST w.e.f. 01.07.2017 and pass it on to his buyers as per their payments made post GST implementation. When the Respondent can utilise the benefit of ITC which has become available to him after the above date while discharging his output GST liability, he can also pass on its benefit to the flat buyers. However, the Respondent is embezzling the above benefit by utilising it in his business and is enriching himself at the expense of the vulnerable sections of the society. Hence, no methodology and procedure or guidelines or elaborate mathematical calculations are required to be prescribed separately for passing on the benefit of ITC. The Respondent cannot deny the benefit of ITC to his customers on the above ground as Section 171 provides clear cut methodology and procedure to compute both the benefits. Therefore, the above contention of the Respondent is frivolous and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justified, accurate and correct and is in consonance with the provisions of Section 171 as has been mentioned in para supra and hence the same can be relied upon. Accordingly, the methodology employed while computing the benefit of ITC which is required to be passed on by the Respondent is held to be correct and binding on the Respondent and all the contrary claims made in this regard by him are rejected. 50. The Respondent has also contended that in pre-GST regime, services were subject to Service Tax at the rate of 15% but under the GST they were taxable at 18%, therefore, there was an increase of 3% in the ITC available which was not due to any additional benefit. In this connection it would be relevant to mention that the Respondent is getting full credit of ITC even if the rate of GST on services has increased from 15% to 18%. Therefore, he cannot claim that he would appropriate the ITC which has additionally become available to him post-GST on services. Moreover, the additional benefit of ITC is not to be computed not only on services but is also to be computed on the goods purchased by the Respondent which constitute very high percentage of his service. The Respondent ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ratio of ITC to the turnover for the pre-GST period since no details have been supplied by the Respondent himself and he has also not reflected them in his VAT Returns. Therefore, the above argument of the Respondent is not tenable. 53. The Respondent has further argued that he should also have been given the benefit of WCT (VAT) while calculating the total credit of pre-GST ITC. On this aspect perusal of the Report of the DGAP shows that in his submissions dated 30.09.2019 the Respondent had claimed credit of rebate of WCT (VAT) paid to the registered contractors or sub-contractors during the pre-GST period. However, perusal of the VAT Returns filed by the Respondent himself shows that no deduction on account of WCT (VAT) was claimed by him on account of payments made to the work contractors in respect of the above Project. Since, the Respondent has not claimed benefit of WCT (VAT) in his VAT Returns he cannot claim the same at this stage. The Respondent has contended that he was to claim the credit as per Section 42 of the Haryana VAT Act 2003 after assessment of his contractors had been finalised. The above claim of the Respondent appears to be an afterthought as he has nei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... um of common credit on account of corporate expenses. However, perusal of the Report of the DGAP shows that the Respondent has not furnished the details of the credit of CENVAT and ITC which he has claimed to have received on account of the purchases made at the Corporate Office level, which should have been included in the computation of ratio of ITC. In this connection it would be relevant to mention that the Respondent has not supplied the details of the credit of CENVAT and ITC during the course of the investigation nor he has submitted them during the present proceedings and hence, the above claim of the Respondent cannot be accepted. 56. The Respondent has also claimed that as per his own computations the ratio of ITC to turnover during the pre-GST period was 4.79% and during the post-GST period it was 10.47% and therefore, the additional benefit of ITC was 5.68% and he has already passed on the benefit of 5.68% to his buyers. In this connection it would be appropriate to mention that the Respondent has included the credit of WTC (VAT) and VAT while computing the ratio of ITC to turnover during the pre-GST period which he has been held not entitled to claim as per the reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court, its members should as nearly as possible, have the same position and status as the Hon ble High Court Judges enjoyed, by ensuring that the persons who were nearly equal in rank, experience or competence to the Hon ble High Court Judges should be appointed as the members of the NCLT. In the present case, no such power of adjudication has been taken away from the Hon ble High Courts or any other Court and this Authority has been established with the statutory mandate under Section 171 of the CGST Act, 2017 to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the prices of the goods or services or both supplied by him. Furthermore, even the Hon ble Supreme Court in the case of R. Gandhi Supra has recognized that there could be an Authority which may have only Technical Members while holding that ..Some highly specialised fact-finding Tribunals may have only Technical Members, but they are rare and are exceptions . . It is also noteworthy here that there are several other authorities like the Telecom Regulatory Authority of India (TRAI); Securities and Exchange Board of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in a commensurate reduction in the prices of the goods or services or both supplied by him, which is a highly specialised fact-finding and technical work which requires intimate knowledge of the Central and the State Goods and Services Tax Acts, the Central Sales Tax Act, 1956, the State Value Added Tax Acts of all the States and Union Territories of the country, the Finance Act, 1994 (Service Tax) and all other connected tax laws which only an officer who has dealt with these Acts/laws can have. Therefore, as per Rule 122 of the CGST Rules, 2017 it has been provided that a person who is appointed as Chairman of this Authority should have held a post equivalent to the Secretary to the Government of India and the Technical Members should have worked as Commissioners of State or the Central Tax for one year before they are appointed as such. Accordingly, the Chairman and the Technical Members of the Authority are being appointed by the competent authority (Appointments Committee of the Cabinet) of the Union Cabinet keeping the requirements of the above mandate of the GST law in perspective. Moreover, the orders passed by this Authority are further subject to the judicial review a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e basis of the Returns filed by the Respondent during the pre and post-GST periods which have been duly verified by the DGAP. Therefore, the Respondent cannot contend that the above Table is incorrect. The computations made in Table-B are also based on the figures mentioned in Table-A which are based on the information supplied by the Respondent himself in respect of the turnover and the area sold by him and hence, he cannot find fault with the above Table. It is also clear from the above Tables that the additional benefit of ITC can only be calculated by comparing the credit of CENVAT availed by the Respondent during the pre-GST period with the ITC availed by him during the post-GST period to calculate the benefit which should be passed on to the buyers as per the provisions of Section 171 (1) of the above Act. The mathematical methodology applied by the DGAP while computing the above ratios and benefit as per the above Tables is correct and the same can be relied upon 65. It is established from the perusal of the above facts that the Respondent has benefited from the additional ITC to the extent of 8.73% of the turnover during the period from July, 2017 to March, 2019 and henc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 2017. 67. It is also evident from the above narration of the facts that the Respondent has denied benefit of ITC to the buyers of the flats being constructed by him in his above project in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and he has thus resorted to profiteering. Hence, he has committed an offence under Section 171 (3A) of the CGST Act, 2017 and therefore, he is apparently liable for imposition of penalty under the provisions of the above Section. Accordingly, a Show Cause Notice be issued to him directing him to explain why the penalty prescribed under Section 171 (3A) of the above Act read with Rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him. 68. The Respondent has himself admitted that he has availed ITC of ₹ 212,29,98,971/- in respect of 24 other projects being executed by the Respondents. The details of all these projects and respective ITC availed by the Respondents are as under:- Sr.No. Project Name ITC Availment (Service Tax) during Period Apr- 16 to June -17 ITC Availment (GST) during Period July -17 to Mar-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 38,14,980 15,540 18 Corporate Office 10,40,36,611 18,15,77,941 - 19 The Esplanade 1,00,70,369 - - 20 Mohali Hills 3,53,15,559 - - 21 Gomti Green 99,76,745 - - 22 Golf Course Hyderabad 63,84,410 - - 23 Indore Greens 30,92,662 - - 24 Jaipur Greens 20,45,417 - - Grand Total 54,08,78,499 2,12,29,98,971 2,67,04,225 Keeping in view the self-admission of the Respondent that he is liable to pass on the be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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