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TMI Blog2022 (6) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on such units sold post completion. Since, the Completion Certificate was obtained for the subject project before the introduction of GST and also there has not been any reduction of GST rate in the instant case, the provisions of Section 171 dealing with Anti-profiteering cannot be made applicable to the said project in the view of the fact that there was no additional ITC which had been utilized by the Respondent, which was relevant for establishing allegation of profiteering. Further, no fresh demand has been raised by the Respondent upon Applicant No.1 in the post-GST regime, only a reminder for previous demand was issued. Launching of the project, Agreement to sell and Completion Certificate of the project had taken place in the pre-GST regime and hence, there was no post-GST tax rate or ITC structure which could be compared with the pre-GST tax rate and ITC and also the anti-profiteering provisions related to Section 171 were not in existence at that time. Accordingly, it is clear that the Respondent had neither benefited from additional ITC nor had there been a reduction in the tax rate in the post-GST period and therefore it does not qualify to be a case of profiteeri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leged that the Respondent had not passed on the benefit of ITC although he had charged GST @12% w.e.f. 01.07.2017 from the said Applicant. This application was forwarded to the Odisha State Screening Committee on Anti-Profiteering on 05.02.2019 and was considered by the Standing Committee on Anti-Profiteering in its meeting held on 11.03.2019, wherein, the Standing Committee referred the complaint to the DGAP for conducting detailed investigation on the allegations levelled by the Applicant No. 1. 2. The said application was examined by the Director General of Anti-Profiteering and the Investigation Report dated 20.09.2019 under Rule 129 (6) of the Rules, was furnished to this Authority. Vide the said Report, it was concluded by the DGAP that the construction service was completed well before the introduction of GST, and any liability of GST of the Applicant No. 1 was only on account of the dues left on account of his booking of the unit prior to issue of Completion Certificate. The DGAP further reported that there was no additional accrual of Input Tax Credit to the Respondent as a result of introduction of GST as the construction service was completed prior to introduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gation Report dated 20.09.2019. Further, letter dated 26.08.2020 followed by reminder letters dated 07.09.2020 30.09.2020 and summons dated 03.11.2020 09.12.2020 were issued to the Respondent by the DGAP, seeking clarifications. The DGAP also sent a letter dated 09.12.2020 to the jurisdictional office (State Jurisdiction) of the Respondent i.e. the Additional Commissioner (State Tax), CT GST Territorial Range, Sundergarh, Rourkela, to collect the necessary documents. The State Jurisdiction Office submitted his reply to the DGAP vide e-mails dated 11.12.2020 22.12.2020. 5. On the basis of the above facts, the DGAP has re-investigated the matter and submitted his Investigation Report dated 30.12.2020 to this Authority, wherein, the DGAP has submitted as under - (a) That as directed by this Authority in its I.O. No. 13/2020 dated 19.03.2020; all the nine issues as mentioned above, had all been duly covered in the report. (b) That the Respondent submitted his replies to the Notice issued by the DGAP, vide letters and e-mails dated 10.09.2020, 06.11.2020, 23.12.2020 29.12.2020. (c) At the time of submission of earlier investigation report dated 20.09.2019, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction office (State Administration) of the Respondent. The officer had forwarded the reply of Respondent to the DGAP. A copy of completion certificate issued by Ar. Arijit Sarkar bearing hand written note Registration No. CA/2000/27049 Screenshot of verification from website was enclosed in the footnote of said certificate. From the said note enclosed screenshot, the DGAP has claimed that the Architect Mr. Arijit Sarkar was registered with Council of Architecture having Registration No.CA/2000/27049. Accordingly, Completion Certificate was valid and accepted in the DGAP report. (ii) Which was the competent Authority to issue the completion certificate in the state of Odisha? Reply of the DGAP The DGAP has also stated that Section 20 of The Orissa Development Authorities Act, 1982, provides for, the Competent Authority to issue the completion certificate. It reads as under: 20. Duration of permission.- Every permission granted under this Chapter shall remain valid up to three years during which period completion certificate from a registered architect or engineer or a person approved by the Authority in the forms prescribed by regulations shall b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the DGAP That the Respondent had claimed total transitional ITC of Rs.16,35,851/- through the IRAN-1 statement filed. Further, vide email dated 29.12.2020, the Respondent had submitted that total transitional ITC of Rs.16,35,851/- was not related to the above project. (vi) Whether the Respondent had availed benefit of additional ITC since July, 2017 till date and he was liable to pass on the same to his buyers? Reply of the DGAP That, the Respondent hadn't availed benefit of additional ITC since July, 2017 till date towards construction service and he was not liable to pass on the same to his buyers. (vii) Whether the above land owners had sold their shares of the houses and, if so, whether they had passed on the benefit of ITC to the buyers of these houses? Reply of the DGAP That vide email dated 29.12.2020, the Respondent had submitted that he had transferred possession of the land-owner's share of units in the project Sahej Valley on 05.05.2016 and he did not have any detail about his status of possession after that. That, since, the project was completed and completion certificate received on 31.03.2016, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was decided to issue Notice to the Applicant No. 1 to file his written submissions and any specific request for hearing, if required, by 20.01.2021. In response to the Notice, the Applicant No. 1 had filed his written submissions on 25.03.2021, wherein, he had made the following submissions: (i) That the reply submitted by the Respondent was concocted, fabricated, baseless and vexatious. (ii) That the Respondent had partially admitted earning of ITC for providing repair and maintenance service only and has clandestinely avoided to admit availment of CENVAT credit in Service Tax Returns during the period from April, 2016 to June, 2017 which was related to the project Sahej Valley . The Applicant No. 1 further stated that the said constructed buildings of the project were not handed over to their buyers within stipulated period and under what circumstances the newly constructed buildings were confined for repair and maintenance? (iii) That the Respondent had not received the Completion Certificate of the project. The Applicant No. 1 had also claimed that no physical possession of the house premises was ever handed over to him inspite of his regular instalments of ban ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecord. The issues to be decided by the Authority are as under:- (I) Whether there is benefit of additional ITC available to the Respondent which has not been passed on by him to the Applicant No. 1. If yes, then what was the quantum of profiteering? (ii) Whether there is any violation of the provisions of Section 171 (1) of the CGST Act, 2017 by the Respondent? 11. Perusal of the record reveals that the complaint of profiteering is in respect of purchase of a Duplex Row House-B3 in the Respondent's project Sahej Valley , Dandipalli, Rourkela, Odisha by the Applicant No. 1.The Applicant No. 1 has provided the copy of Allotment letter dated 23.10.2014, money receipts dated 20.12.2014, 29.05.2015, 07.11.2015 and 25.05.2016, Agreement to Sell dated 24.04.2016 and Tri-Partite Agreement dated 17.05.2016. In reply to the complaint submitted by the Applicant No. 1, the Respondent has submitted a copy of the Completion Certificate dated 31.03.2016 issued by Sh. Arijit Sarkar, Empanelled Architect of Rourkela Development Authority, to claim that his project was completed well before the inception of the GST regime and he was not liable to pass on the benefit of ITC to the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cal law requirement then any of the above three documents will fulfil the requirement for not charging Service Tax. Above law requirement is further substantiated by Point 6.2.7 of Education Guide issued dated 20.06.2012 by CBIC which provides: In terms of Explanation to clause (b) of section 66E in such cases the completion certificate issued by an architect or a chartered engineer or a licensed surveyor of the respective local body or development or planning authority would be treated as completion certificate for the purposes of determining chargeability of service tax. Further, Section 20 of the Orissa Development Authorities Act, 1982, provides as under:- 20. Duration of permissions- Every permission granted under this Chapter shall remain valid up to three years during which period completion certificate from a registered architect or engineer or a person approved by the Authority in the forms prescribed by regulations shall be submitted and if this is not done, the permission shall have to be revalidated before the expiration of this period on payment of such fee as may be prescribed under rules and such revalidation shall be subject to the rules and reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e construction service did not arise at all. In view of the above facts, it is apparent that the Respondent had obtained his Completion Certificate on 31.03.2016 from the Architect registered under the Rourkela Development Authority, who is a competent authority to issue a Completion Certificate and the same has been confirmed by the DGAP. Since, no Service Tax or GST has been charged from the buyers post receipt of the Completion Certificate dated 31.03.2016, no benefit of ITC/CENVAT credit towards Construction service for the impugned project in the relevant period was availed by the Respondent. 14. A perusal of Section 171 of the CGST Act shows that it 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. It is clear from a plain reading of Section 171 (1) mentioned above that it deals with two situations- one relating to the passing on the benefit of reduction in the rate of tax and the second pertaining to the passing on the benefit of the ITC. On the said issues, it is apparent from the DGAP's Report and the available record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llaneous Application No 21 of 2022 in MA 665 of 2021 in Suo Moto Writ Petition (C) no. 3/2020, vide its Order dated 10.1.2022 has directed that:- I. The order dated 23.03.2020 is restored and in continuation of the subsequent orders dated 08.03.2021, 27.04.2021 and 23.09.2021, it is directed that the period from 15.03.2020 till 28.02.2022 shall stand excluded for the purposes of limitation as may be prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings. II. Consequently, the balance period of limitation remaining as on 03.10.2021, if any, shall become available with effect from 01.03.2022. III. In cases where the limitation would have expired during the period between 15.03.2020 till 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022 is greater than 90 days, the longer period shall apply. IV. It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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