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TMI Blog2022 (6) TMI 1165X X X X Extracts X X X X X X X X Extracts X X X X ..... lable to the Respondent during the pre-GST period (April-2016 to June-2017) was 2.34% and during the post-GST period (July-2017 to December-2018), it was 5.65% for the project Sports Vile . This confirms that, post-GST, the Respondent has been benefited from additional ITC to the tune of 3.31% (5.65% - 2.34%) of his turnover for the project Sports Ville and the same was required to be passed on to the customers/ home/shop buyers. The DGAP has calculated the amount of ITC benefit to be passed on to all the flat buyers as Rs. 1,42,45,741/- for the project Sports Ville which was availed by the Respondent. The Respondent has not disputed the findings of the DGAP regarding method of computation of profiteering and the amount worked out by him. As such, the Authority finds no reason to differ from the above-detailed computation of profiteering in the DGAP s Report or the methodology adopted and hence, the Authority determines the profiteered amount for the period from 01.07.2017 to 31.12.2018, in the instant case, as Rs. 1,42,45,741/-, for the project Sports Ville . Interest - HELD THAT:- The Authority directs the concerned jurisdictional CGST/SGST Commissioner to ensure that such amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Applicant No. 1 filed an application dated 19.09.2018, before the National Anti-profiteering Authority (Authority) under Rule 128 (1) of the CGST Rules, 2017 alleging profiteering by the Respondent in respect of purchase of Flats in his "Sports Ville" project located in Sector-2 & 35, Sohna, Gurgaon. The above Applicant No. 1 also alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) availed by him by way of commensurate reduction in the price of the above flats. The said application was forwarded by this Authority to the Standing Committee on Anti-profiteering for further necessary action. The aforesaid application was considered by the Standing Committee on Anti-profiteering, in its meeting held on 27th December, 2018, 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. The DGAP has covered the period from 01.07.2017 to 31.12.2018 for the investigation and relevant documents were called from the Respondent. From the data submitted by the Respondent for the period April, 2016 to December, 2018, the details of the input tax credits availed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... = 5.65% less 2.34% 3.31 3.31 3.31 5. Analysis of Increase in input tax credit: 6. Base Price raised during July, 2017 to December, 2018 (Rs.) E 18,12,49,356 21,05,42,265 39,17,91,621 7. GST @12% or 8% (Rs.) F=E*B 2,17,49,923 1,68,43,381 3,85,93,304 8. Total Demand raised G=E+F 20,29,99,279 22,73,85,646 43,03,84,925 9. Recalibrated Base Price H=E*(1-D) or 96.69% of E 17,52,50,002 20,35,73,316 37,88,23,318 10. GST @12% or 8% I=H*B 2,10,30,000 1,62,85,865 3,73,15,866 11. Commensurate demand price J=H+I 19,62,80,003 21,98,59,181 41,61,39,184 12. Excess Collection of Demand or Profiteered Amount K=G-J 67,19,276 75,26,465 1,42,45,741 The DGAP concluded that the total benefit of ITC that the Respondent was required to pass on during the period 01.07.2017 to 31.12.2018 in respect of both residential flats as well as commercial shops, came to Rs.1,42,45,741/- which included GST (@ as applicable) on the base amount of Rs. 1,29,68,303/-. Out of the total profiteered amount of Rs.1,42,45,741/-, the Respondent has realised additional amount of Rs. 70,728/- from the Applicant No. 1, inclusive of GST. 3. The DGAP vide Table-'D& ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reconcile the customer accounts at the time of possession, in all respect. Further, the Respondent vide reply dated 13.07.2020 submitted that they had obtained Occupation Certificate and had issued offer for possession, inviting all customers to complete documentation and take possession, but due to COVID-19, few people had approached him. d. That the ITC benefit claimed to have been passed on to his home buyers by the Respondent, the verification had been done of the ITC passed on to individual customers (as provided by the Respondent) with the soft copies of Ledger Accounts (MS-Excel format), letter (pdf format) issued to customers, as submitted by the Respondent. On verification of the copies of Ledger Accounts, it appeared that the Respondent had claimed to pass on the ITC benefit of Rs. 1,42,56,347/- to 768 home buyers only. Further it was also observed that in some cases, the Respondent had claimed to pass on the benefit of additional ITC than the actual amount. In some cases, the benefit of ITC passed on was less than the amount that should have been passed on. A summary of category-wise ITC benefit required to be passed on (profiteering amount as per Report dated 02.07.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondent had passed on the benefit of ITC amounting to Rs, 2,61,698/- (Column-El + E2) to 15 home buyers (mentioned at S. No. 1 & 2). The Respondent had passed on less benefit to 04 home buyers (mentioned at S. No. 3) to the tune of Rs. 1,93,579/- (Column E3 -D3) and no benefit had been passed on to 01 home buyer (mentioned at S. No. 4, Column E4). The Respondent had to further pass on the due benefit of Rs. 2,11,023/- (Rs. 1,93,579/- (+) Rs. 17,4441-) to these 04 home buyers. As per the above discussion, it was evident that there was variation in the submissions of the Respondent himself. f. That to verify the Respondent's claim of passing on of the benefit of ITC, email dated 16.09.2020 was sent to 186 home buyers, randomly selected, to confirm the amount of benefit received from the Respondent. As the home buyers didn't respond, second email dated 21.09.2020 was sent to other 62 additional home buyers, selected randomly. In response to these 248 emails, which was more than 30% of 768 home buyers, only 21 home buyers (i.e. 8.5% of sent) responded. Out of these 21 home buyers, 15 have denied receipt of any correspondence from the Respondent. Other 06 home buyers confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same or not making correct submissions. e. That if this Authority directed him to submit acknowledgements from any random customers, he was ready to submit the same. f. The Respondent requested to allow him to prove his claim of passing on benefit to all those denying receipt of benefit and in case any one is left out, the chances of which are highly improbable, he was duty bound to pass on. g. That those denying would be such customers who had not paid full dues and taken possession letters despite of repeated reminders and even in such cases he had reduced their total liability with passed on GST benefit. h. That many customers had not come and taken their possession letter due to worsening Covid-19 situation. Once they came, he would be able 'to have all acknowledgements and submit accordingly. 7. The Respondent vide his supplementary/additional submissions dated 14.12.2020 has stated:- a. That ITC benefit of Rs. 1,42,56,347/- had already been passed on to 762 customers/ home/shop buyers, the list of customers/ home/shop buyers and ITC benefit claimed to have been passed on to each of them was furnished. b. That he had received more than 85 acknowledgements ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vailable. Vide email dated 04.02.2021, the Respondent was requested to provide email addresses of those 39 home buyers. The Respondent, vide his email dated 12.02.2021, provided email addresses of 25 home buyers and also stated that out of the 39 home buyers, 3 had already withdrawn their applications for flats and the email addresses of 11 buyers were being obtained. b. Out of 71 home buyers listed by this Authority replies were required from 65 home buyers, as three names had been repeated and three home buyers withdrew their applications. Out of the 65 home buyers, 32 home buyers had replied. Further, in response to previous emails of the DGAP to the home buyers as per its report dated 11.01.2021, 30 other home buyers not figuring in this Authority's list, had submitted their responses out of which most of the homebuyers have replied in negative. The replies of the 62 home buyers were enclosed with the above letter. 12. The DGAP vide his supplementary verification reports dated 11.04.2022 and 02.05.2022 has stated that- a. Further email letters dated 31.03.2022 were sent to 26 homebuyers again wherein 04 homebuyers have replied. Further, vide email letter dated 05.04.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent had credited the GST benefit to all these buyers also in their accounts maintained by the Respondent. Accordingly, the GST benefit to all these 30 buyers will be adjusted against their liability and if the liability had already been discharged by some buyers the GST benefit would be refunded to such homebuyers. In case of six home buyers such GST benefit had already been refunded by way of cheques as was evident from the ledgers of theses home buyers. d. That the Respondent prayed to this Authority to hold that the Respondent had passed the GST benefit to each of his home buyers and accordingly the proceedings against the respondent in the present case might be dropped. 15. Further hearing in the matter was held on 11.04.2022. Same was attended by Shri Sandeep Chaudhary, Advocate, Shri Parveen Hooda and Shri Sourabh Singh, General Managers, Administration for the Respondent and Shri Lal Bahadur, Assistant Commissioner for the DGAP. Applicant No. 1 did not appear for the hearing. During the personal hearing the Respondent was heard. The Respondent has re-iterated his arguments based on his written submissions dated 24.11.2020, 14.12.2020, 25.01.2021 and 01.03.2021. Further, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m additional ITC to the tune of 3.31% (5.65% - 2.34%) of his turnover for the project 'Sports Ville' and the same was required to be passed on to the customers/ home/shop buyers. The DGAP has calculated the amount of ITC benefit to be passed on to all the flat buyers as Rs. 1,42,45,741/- for the project "Sports Ville' which was availed by the Respondent. 20, The Respondent has not disputed the findings of the DGAP regarding method of computation of profiteering and the amount worked out by him. As such, the Authority finds no reason to differ from the above-detailed computation of profiteering in the DGAP's Report or the methodology adopted and hence, the Authority determines the profiteered amount for the period from 01.07.2017 to 31.12.2018, in the instant case, as Rs. 1,42,45,741/-, for the project 'Sports Ville'. 21. 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 customers/ home/shop buyers commensurate with the benefit of ITC received by him as has been detailed above. 22. The Respondent is required to pass on/return such amount profiteered by him along with int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent, if not already paid. As observed by the Authority, the conclusive proof of passing benefits and its method is discussed in the earlier paragraphs. 27. The Respondent is also liable to pay interest as applicable on the entire amount profiteered, i.e. Rs. 1,42,45,741/-, for the project 'Sports Ville". Hence the Respondent is directed to also pass on interest @18% to the customers/ home/shop buyers on the entire amount profiteered, starting from the date from which the above amount was profiteered till the date of passing on/ return/refund, as prescribed under Rule 133 (3) (b) of the CGST Rules 2017. 28. We also order that the profiteering amount of Rs. 1,42,45,741/- for the project 'Sports Ville' along with the interest @ 18% from the date of receiving of advance from the customers/ home/shop buyers till the date of passing the benefit of ITC shall be paid/passed on by the Respondent within a period of 3 months from the date of this order failing which it shall be recovered as per the provisions of the CGST Act, 2017. 29. It is evident from the above narration of facts that Respondent has denied the benefit of ITC to the customers/ home/shop buyers in contrav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respective of the limitation prescribed under the general law or Special Laws whether condonable or not shall stand extended w. e. f. 15th March 2020 till further order/s to be passed by this Court in present proceedings." Further, the Hon'ble Supreme Court, vide its subsequent Order dated 10.01.2022 has extended the period(s) of limitation till 28.02.2022 and the relevant portion of the said Order is as follows:- "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 of special laws in respect of all judicial or quasi-judicial proceedings." Accordingly this Order having been passed today falls within the limitation prescribed under Rule 133(1) of the CGST Rules, 2017. 33. A copy of this order be sent, free of cost to, the Applicants, the DGAP, the Respondent, Commissioners CGST/SGST Haryana, the Principal Secretary (Town and Country Planning), Government of Haryana as well as Haryana RERA for necessary action. File to be consigned after completion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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