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TMI Blog2020 (8) TMI 773X X X X Extracts X X X X X X X X Extracts X X X X ..... h had accrued to the Respondent post-GST as compared to pre-GST period. This case does not fall under the ambit of Anti-Profiteering provisions of Section 171 of the CGST Act, 2017 as the Respondent had not availed benefit of additional ITC in the post-GST regime. Hence, the allegation of not passing on the benefit of ITC is not established against the Respondent. Therefore, the Respondent is not liable to pass on the benefit of ITC to the Applicant No. 1 and the other recipients. Accordingly, the provisions of Section 171 (1) of the CGST Act. 2017 have not been contravened in the present case. The application filed by the Applicant No. 1 requesting action against the Respondent for alleged violation of the provisions of the Section 171 of the CGST Act is not maintainable and hence the same is dismissed. - Case No. 54/2020 - - - Dated:- 24-8-2020 - DR. B.N. SHARMA, CHAIRMAN, SH. J.C. CHAUHAN, TECHNICAL MEMBER, SH. AMAND SHAH, TECHNICAL MEMBER Present:- None for Applicants. None for the Respondent. ORDER 1. The present Report dated 31.01.2020 has been received from the Applicant No. 2 i.e. the Director General of Anti-Profiteering (DGAP) after a d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Respondent to appear in the DGAP's office on 16.10.2019 and to submit the requisite documents/information, however the above persons had not appeared. 4. The DGAP has also stated that in compliance of the second summons dated 17 10 2019, the Respondent had again not appeared on 25.10.2019 and did not submit any documents/information/letter. 5. The DGAP has further stated that in response to the notice dated 16.05 2019. subsequent two reminders and two summons. the Respondent did not submit necessary documents required for investigation and therefore, under the provisions of Section 67 of CGST Act. 2017 read with Rule 139 of the above Rules, the DGAP's officers had visited the premises of the Respondent on 20.11.2019 21.11.2019 and collected the requisite information and documents necessary for investigation. 6. The DGAP has also reported that the Applicant No. 1 was also given opportunity to inspect the non-confidential documents/reply furnished by the Respondent on 20.01.2020 and 21.01.2020 which was however not availed of by the Applicant No. 1. 7. The DGAP has also stated that the period covered by the current investigation was from 01.07.2017 to 30.04.2019 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 Aryan Founttain Square Residential Apartment 2012 Major Portion completed in the year 2014 and the remaining completed during subsequent years and further received O.C. on 11.04.2018. 7 Palm Groves Residential 2013-14 Still under construction 8 Aryan Golden Arena Residential 2015-16 Still under Construction c. That the project Aryan Founttain Square was developed under the Joint Development Agreement (JDA) dated 24.09.2012 entered into with Sh. B. G. Anjannappa, S/o late Sh. B H. Gunda Reddy, the land owner. It was a residential complex developed on vacant land located at Indlebele Village, Attibele-Sarjapur Road, Anekal Taluk, Bengaluru. The total constructed area of the residential complex was 2,90.106 sq. ft. consisting of 324 flats in a single tower and vide sharing agreement dated 20.12.2012 it was mutually agreed to share the super built-up area in the ratio 37:63 i.e. 37% of the super buil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... That considering his present position, any lapse on his part of non-compliance of the directions of the DGAP in respect of investigation initiated for project Aryan Fountain Square. might be condoned. 10. The DGAP has further intimated that vide the aforementioned letters and statement, the Respondent has submitted the following documents/information:- (a) Copies of GSTR-1 Returns for the period from July, 2017 to December, 2018. (b) Copies of GSTR-3B Returns for the period from July, 2017 to August, 2018. (c) Copies of Audited Balance Sheets for the FY 2016-17 2017-18. (d) Copy of Occupancy Certificate dated 11.04.2018 received for the project Aryan Founttain Square (e) Copies of the demand letters/sale agreement during the pre and post GST period of one of his Home Buyers. (f) Copy of RERA Registration Certificate. (g) Project-wise details of VAT, Service Tax and ITC of VAT/Service Tax. (h) List of all home buyers of the project Aryan Founttain Square . (i) Copies of Electronic Credit Ledger for the period from July, 2017 to August, 2018. (j) That he had not filed any Tran-1 and Tran-2 statements during July, 2017 to De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Slab 5% 7 Second Floor Slab 5% 8 Third Floor Slab 5% 9 Fourth Floor Slab 5% 10 Fifth Floor Slab 5% 11 Sixth Floor Slab 5% 12 Seventh Floor Slab 5% 13 Terrace Floor Slab 5% 14 Masonry 5% 15 Plastering/Painting 5% 16 Possession 5% Total 100% 14. The DGAP has also stated that prior to the implementation of the GST w.e.f. 01.07 2017. Service Tax on the construction service was chargeable @ 4.50% vide Notification No. 14/2015-ST dated 19.05.2015. After implementation of the GST w.e.f. 01.07.2017, GST on construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST period i.e. from 01.04.2016 to 30 06.2017. In the post-GST period from 01.07.2017 to 30.04.2019, the Respondent had not availed any ITC but received amount on account of prices of the flats. Hence, no comparison of credit available in the pre and the post GST periods could be made by the DGAP. Therefore, in the absence of any credit availability in the post GST period there might not be any commensurate reduction in prices on account of ITC accrual. 17. The DGAP has also submitted that the Respondent's project Aryan Founttain Square was started in 2012 and most of the work of the project was completed in 2014 but the project could not be completed on time. However, the Respondent had completed the project in March, 2018 and obtained the OC on 11.04.2018. It was also observed that the Respondent had failed to pay due Service Tax in the pre-GST period and had also defaulted in the payment of GST and filing of GST Returns in the post-GST period. Since the Respondent had neither paid Service Tax nor filed Service Tax Returns. it could be concluded that the Respondent did not avail any CENVAT/credit of the input services during the period from 01.04.2016 to 30.06.2017 (Pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y violation of the provisions of Section 171 of the CGST Act, 2017? 23. In this connection it would be relevant to refer to Section 171 of the CGST Act, 2017 which provides 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 force, to examine whether ITCs availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him. (3). The Authority referred to in sub-section (2) shall exercise such powers and discharge such functions as may be prescribed. (3A) Where the Authority referred to in sub-section (2) after holding examination as required under the said sub-section comes to the conclusion that any registered person has profiteered under sub-section (1), such person shall be liable to pay penalty equivalent to ten percent of the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case does not fall under the ambit of Anti-Profiteering provisions of Section 171 of the CGST Act, 2017 as the Respondent had not availed benefit of additional ITC in the post-GST regime. Hence, the allegation of not passing on the benefit of ITC is not established against the Respondent. Therefore, the Respondent is not liable to pass on the benefit of ITC to the Applicant No. 1 and the other recipients. Accordingly, the provisions of Section 171 (1) of the CGST Act. 2017 have not been contravened in the present case. 26. Therefore, the application filed by the Applicant No. 1 requesting action against the Respondent for alleged violation of the provisions of the Section 171 of the CGST Act is not maintainable and hence the same is dismissed. 27. As per the provisions of Rule 133 (1) of the CGST Rules, 2017 this order was required to be passed within a period of 6 months from the date of receipt of the Report from the DGAP under Rule 129 (6) of the above Rules. Since, the present Report has been received by this Authority on 31.01.2020 the order was to be passed on or before 30.07.2020. However, due to prevalent pandemic of COVID-19 in the Country this order could not be pas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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