Case Law Details
S. Ganapathy Subramanian Vs Mahindra Lifespace Developers Ltd. (NAA)
1. In the present case the first investigation Report dated 05.11.2018 was received from the Applicant No. 2 i.e the Director General of Anti-Profiteering (DGAP) after detailed investigation under Rule 129 (6) of the Central Goods & Service Tax (CGST) Rules, 2017, The brief fads of the case were that an application before the Standing Committee on Anti-profiteering under Rule 128 (1) of the CGST Rules, 2017, was filed by the Applicant No. 1 alleging profiteering by the Respondent in respect of purchase of a flat in the Respondent’s “Avadi” Project at Chennai. He had also alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) to him. The aforesaid application was considered by the Standing Committee on Anti-profiteering, in its meeting held on 25.05.2018, the minutes of which were received by the DGAP on 08.06.2018, whereby it was decided to forward the same to the DGAP to conduct a detailed investigation in the matter under Rule 12 (1) of the above Rules. The DGAP in his Report had stated that the Respondent did not co-operate with the investigation and tried to delay the investigation intentionally, The DGAP had also stated that the Respondent had not Submitted the complete information required for the investigation. The DGAP had further stated that claim of the Respondent that the benefit of GST Input Tax Credit was already factored in the construction cost was not substantiated as the Respondent had recently communicated this information to the Applicant vide e-mail dated 01.06.2018. The DGAP had also observed that turnover of the Respondent during the period from July, 2017 to August, 2018 did not reconcile with the GST Returns filed by him and hence, the project details submitted by the Respondent could not be relied upon. It was also noticed by the DGAP that the Respondent had benefited from the additional input tax credit to the extent of 7.57% of the taxable turnover. The DGAP had calculated the amount of profiteering in this case as Rs. 2,04,65,828/-
2. This Authority, after perusal of the above Report of the DGAP had decided to accord hearing to the concerned parties. During the hearing held on 13.12.18 this Authority had asked the Respondent to submit details of the project under investigation and his other projects along with the Anti-Profiteering compliance and the details of the Completion Certificates (CC), The Respondent had submitted only the details of the project under investigation and no details of his other projects were supplied. Next hearing was held on 07.01.2019 when this Authority had again asked the Respondent to submit the current status and details of all the projects constructed by the Respondent to the DAP. The Respondent had submitted the details of the project under investigation vide letter dated 25.01.2019 but did not submit the details of other projects,. The Respondent also refused to accept the calculation of the ratios of CENVAT/ITC to the turnovers made by the DGAP in his Report dated 05.11.2018 and submitted new figures of ITC and turnovers for the pre and post GST periods as per the following table:-
3. The Respondent had claimed that the net additional ITC benefit was 0.16% which was quite different from the benefit of 7.57% as per the investigation Report of the DGAP. It was evident from the above claims of the Respondent that there were serious differences in the calculations of the above ratios made by the Respondent and the DGAP which required re-investigation.
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