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TMI Blog2022 (9) TMI 313X X X X Extracts X X X X X X X X Extracts X X X X ..... booking in the instant project was made by the Respondent on 06.09.2018 and the Applicant had booked the Flat no. 201 on 15.10.2018 i.e. in post-GST period. Further, as per the registration details, the Respondent having Registration No. 336/2004 obtained Building Permission from 02.02.2018 which was also the Project starting date. There was no pre-GST tax rate/ details or ITC credit structure/details which could be compared with the post-GST tax rate and ITC - The Applicant No. 1 has not responded on the merit in respect of the DGAP report dated 27.01.2021. The contention of the Applicant No. 1 regarding denial of principles of natural justice is found to be unsustainable as enough opportunities were provided to him to put up in case before the Authority. This Order having been passed today falls within the limitation prescribed under Rule 133 (1) of the CGST Rules, 2017. - Case No. 65/2022 - - - Dated:- 31-8-2022 - SH. AMAND SHAH, TECHNICAL MEMBER CHAIRMAN, SH. PRAMOD KUMAR SINGH, TECHNICAL MEMBER, SH. HITESH SHAH, TECHNICAL MEMBER. Present:- 1. None for the Applicant No 1. 2. Shri Bukari Babu Mohammed, Chartered Accountant, for the Respondent ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te the same in his reply to the Notice as well as furnish all documents in support. The Respondent was also allowed to inspect the relied upon non-confidential evidences/information furnished by the Applicant No. 1 during the period 25.07.2020 to 26.07.2020. However, the Respondent had not availed of the said opportunity. iv. The period covered by the current investigation was from 01.07.2017 to 31.05.2020. v. The time limit to complete the investigation was 02.12.2020. However, in terms of Notification No. 35/2020 Central Tax dated 03.04.2020, Notification No. 55/2020-Central Tax dated 27.06.2020, Notification No. 65/2020-Central Tax dated 01.09.2020, and further amended vide Notification No. 91/2020 Central Tax dated 14.12.2020, issued by the Central Board of Indirect Taxes and Customs under Section 168 (A) of the CGST Act, 2017, where, any time limit for completion or compliance of any action, which falls during the period from the 20th day of March, 2020 to the 30th day of March, 2021. and where completion or compliance of such action had not been made within such time, then the time limit for completion or compliance of such action, shall be extended upto the 31st day of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-19. f) Copies of all demand letters issued and sale agreement made with the Applicant. g) Copy of Balance Sheet (including all annexures and profit/loss account) for FY 2017-18 2018-19, h) Details of output GST and ITC of GST for the period July, 2017 to May, 2020 for the project Sai Partha Sreekar Residency . i) Reconciliation statement with respect to GST ITC with GSTR-3B for FY 2017-18, 2018-19, 2019-20 and May 2020. j) List of all home buyers in the project Sai Partha Sreekar Residency k) Details of registration with AP RERA l) Details of Applicable tax rates, Pre-GST and Post-GST. m) Copy of Occupancy Certificate. viii. The Respondent was informed that if any information/documents was provided on confidential basis, in terms of Rule 130 of the Rules, a non-confidential summary of such information/documents was required to be furnished. The Respondent vide email dated 08.01.2021 claimed confidentiality of all information provided to this office. ix. The subject application, various replies of the Respondent and the documents/evidences on record had been carefully examined. The main issues for determination are a) Whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tional ITC available to him post- GST. xi. Prior to implementation of GST w.e.f. 01.07.2017. Service tax on construction service was chargeable @ 4.50% (vide Notification No. 14/2015-ST dated 19.05.2015). After implementation of GST w.e.f 01.07.2017, GST on construction services was chargeable 18% (effective rate was 12% in view of 1/3rd abatement on value) on construction service vide Notification No 11/2017-Central Tax (Rate) dated 28.06.2017 and the effective GST rate on construction service in respect of affordable and low cost houses upto a carpet area of 60 square meters was further reduced to 12% GST (effective rate was 8% in view of 1/3 rd abatement on value), vide Notification No. 1/2018 Central Tax (Rate) dated 25.01.2018 (in respect of affordable and low-cost house upto a carpet area of 60 square meters). Thus, it was observed that in the case construction services the effective rate of tax (4.5%) in the Pre-GST was lower than the effective rate of tax @ 8% or 12% as applicable, in Post-GST era. xii. On scrutiny of the documents submitted by the Respondent, it was observed that the Development Agreement coupled with General Power of Attorney between land owners an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Andhra Pradesh only. xvii. The DGAP in it's report dated 27.01.2021 has concluded that Section 171 (1) of the CGST Act, 2017, requiring that 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 was not applicable in the present case. 3. The above investigating report was received by this Authority from the DGAP on 29.01.2021 and was considered in its sitting and it was decided to ask the Applicant No. 1 to file his consolidated written submissions in respect of the Report of the DGAP. Notice dated 04.02.2021 was also issued to the Applicant No. 1 directing him to explain why the Report dated 27.01.2021 furnished by the DGAP should not be accepted. 4. The Applicant No. 1 has filed his submissions dated 15.02.2021, 12.03.2021 and 22.03.2022. The reply of the Respondent was summed up as follows:- a) The Investigating Authority had not supplied all relevant documents, so the Applicant No.1 was unable to file her proper written submissions. b) That the Authority has consumed more than one year period for very simple and negligible issue. c) Insist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly examined the DGAP's Report including documents enclosed therewith, the written submissions of the Applicant No. 1 and the clarifications filed by the DGAP on the submissions filed by the Applicant No. 1. It is noted that the Respondent is in the real-estate business and has developed his project Sai Partha Sreekar Residency , in Marripalem Vuda Layout, Visakhapatnam. It is also on record that the Applicant No.1 has filed a complaint alleging that the Respondent had not passed on the benefit of ITC to him by way of commensurate reduction in the price of the Flat No. 201 purchased from the Respondent in his project Sai Partha Sreekar Residency in terms of Section 171 of the CGST Rules, 2017. 9. It is also noted that the DGAP, after a detailed investigation, has found that the Respondent has not contravened the provisions of Section 171 of the CGST Act, 2017 as the date of commencement of the instant project was after the inception of GST w.e.f. 01.07.2017. Further, the first booking in the instant project was made by the Respondent on 06.09.2018 and the Applicant had booked the Flat no. 201 on 15.10.2018 i.e. in post-GST period. Further, as per the registration details, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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