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TMI Blog2022 (5) TMI 1594X X X X Extracts X X X X X X X X Extracts X X X X ..... y finds that there exists reason to investigate other nine projects for the purpose of determination of profiteering. Accordingly, this Authority as per the provisions of Section 171(2) of the above Act take suo motu cognizance of the same and in terms of Rule 133(5) of the said Rules, directs the DGAP to conduct investigation in respect of the other nine projects and submit Report to this Authority for determination whether the Respondent is liable to pass on the benefit of ITC in respect of the other 9 projects/towers as mentioned in Table-B' of the DGAP's Report to the buyers or not as per the provisions of Section 171 (1) of the above Act. This Order having been passed today falls within the limitation prescribed under Rule 133(1) of the CGST Rules, 2017. - SHRI AMAND SHAH, CHAIRMAN, PRAMOD KUMAR SINGH AND HITESH SHAH, MEMBERS (T) ORDER Present Report dated 27-11-2020, had been furnished by the Applicant No. 2 i.e. the Director General of Anti-Profiteering (DGAP) after a detailed investigation, under rule 129 (6) of the Central Goods Services Tax (CGST) Rules, 2017. The brief facts of the case are that the Applicant No. 1 had filed an application under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecified in, or prescribed or notified under the CGST Act, 2017 which falls during the period from the 20th day of March, 2020 to the 29th day of June, 2020, 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, was extended up to the 30-6-2020. Further, vide Notification No. 55/2020-Central Tax, dated 27-6-2020 and by Notification No. 65/2020- Central Tax dated 1-9-2020, the time-limit for compliance was extended up to 30-11-2020. This Authority, vide its Order dated 26-8-2020, in terms of Rule 129(6) of the Rules allowed further extension of three months. (vi) in response to the Notice dated 23-10-2019, the Respondent submitted his reply vide letters and e-mails dated 5-11-2019, 27-12-2019, 20-1-2020, 11-2-2020, 3-7-2020, 24-7-2020, 28-7-2020, 30-7-2020, 31-7-2020, 5-8-2020 and 15-10-2020. The detailed submissions of the Respondent to the DGAP have been summed up below wherein, inter alia, it was stated that:- (a) the Respondent had duly passed on the benefit of ITC to his customers by way of commensurate reduction in prices. For booking made after 1st July, 2017, booking price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been registered and approved by the Maharashtra Real Estate Regulatory Authority (MahaRERA), under section 5 of the Real Estate Regulation Development (RERA) Act, 2016 under project registration number P52000014856. The Registration is valid for a period commencing from 8-1-2018 and ending with 31-1-2023 unless renewed by the Maharashtra RERA in accordance with Section 5 of the RERA Act read with Rule 6. (vii) Vide the aforementioned letters, the Respondent submitted following documents/ information: (a) Copies of GSTR-1 Returns for the period July, 2017 to September, 2019. (b) Copies of GSTR-3B Returns for the period July, 2017 to September, 2019. (c) Electronic Credit Ledger for the period July, 2017 to September, 2017. (d) Brief Profile of the Respondent. (e) Copy of GSTR-9 Return for the period July, 2017 to March, 2018. (f) Copies of VAT Returns (including all annexure) and Service Tax Returns for the period April, 2016 to June, 2017. (g) Copies of all demand letters issued and sale agreement made with the Applicant No. 1. (h) Copy of Balance Sheet/Profit Loss/Cash Flow Statement/Notes to Accounts for FY 2016-17, 2017-18 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the residential units which were under construction but not sold was provisional ITC which might be required to be reversed by the Respondent, if such units remained unsold at the time of issue of the Completion Certificate, in terms of section 17(2) Section 17(3) of the CGST Act, 2017, which read as under: Section 17 (2) Where the goods or services or both was 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 exempted supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as was attributable to the said taxable supplies including zero-rated supplies . Section 17 (3) The value of exempted supply under sub-section (2) shall be such as maybe prescribed and shall include supplies on which the recipients liable to pay tax on reverse charge basis, transactions in securities, sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building . Therefore, the ITC pertaining to the unsold units might not fall within the ambit of this investigation and the Respondent was re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ya Tower 1C P52000014859 New project 7. Adhiraj Samya Tower 1B P52000004493 Ongoing project 8. Adhiraj Samya Tower 1D P52000014856 New project 9. Adhiraj Capital City Meraki P52000022975 New project 10. Adhiraj Capital City Oreka P52000022907 New project (iii) from the above said facts , it was observed by the DGAP that- (a) RERA Registration details indicated that the projects 'Samyama City Tower 1-D' started in January, 2018. (b) The details submitted by the Respondent at Table 'A' of the report dated 27-11-2020 mentioned that the CENVAT/VAT up to June, 2017 was 'Nil' for the project under investigation, though he had shown availability of CENVAT/VAT with respect to other projects. (c) The Respondent had given the Homebuyers list which showed that the first booking was on 19-1-2018. (d) The Applicant No. 1 had not provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices , was not applicable in the present case. 5. The above investigating report was received by this Authority from the DGAP on 27-11-2020, 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 4-12-2020, was also issued to the Applicant No. 1 directing him to explain why the Report dated 27-11-2020, furnished by the DGAP should not be accepted.? 6. The Applicant No. 1 vide his email dated 13-12-2020, stated that he had accepted the Report of the DGAP and was ready to abide by the decision made by the Competent Authority. 7. The proceedings in the matter could not be completed by the Authority due to lack of required quorum of Members in the Authority during the period 29-4-2021 till 23-2-2022, and the minimum quorum was restored only w.e.f. 23-2-2022, and hence the matter was taken up for further proceedings vide Order dated 23-3-2022, and the Applicant No. 1 was given one more opportunity to file written submissions against the DGAP&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the case of the Respondent, the above provision implies that he was required to maintain ten separate escrow/bank accounts in respect of all projects as mentioned in 'Table-B' of the DGAP report dated 27-11-2020. However the DGAP's Report has no mention of this aspect. As the Respondent had obtained ten separate RERA registrations for his ten projects, he should have maintained separate escrow/bank accounts. 12. It is also noted that the Respondent has single GST registration for the all ten projects and is maintaining a joint ITC Register and is availing ITC on all the projects. He is executing all projects from a common pool of ITC, to discharge his tax output liability on these projects through the combined GSTR-3B Returns and that he has availed substantial CENVAT/VAT credit in pre-and post-GST period in respect of these other projects. In view of the above said facts, there exist reasons to believe that other nine projects on which the Respondent is availing ITC from the common pool may be investigated to determine whether he has passed on the benefit of ITC to the buyers of each project, which are being executed by him. 13. For the reasons discussed ear ..... X X X X Extracts X X X X X X X X Extracts X X X X
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