Case Law Details
Jotbir Singh Bhalla Vs Suncity Projects Pvt. Ltd. (NAA)
The brief facts of the case are that the DGAP had received a reference from the Standing Committee on Anti-Profiteering on 28.06.2019 to conduct a detailed investigation in respect of a complaint filed by Applicant No. 1 before the Standing Committee on Anti-profiteering, stating therein that he had purchased a flat in the project ‘Suncity Avenue-102’, Sector-102, Gurgaon, Haryana from the Respondent, and that the Respondent had not passed on the benefit of input tax credit to him by way of commensurate reduction in price in terms of Section 171 of the CGST Act, 2017. Before recommending the investigation under Rule 129 (1) of the CGST Rules, 2017, the aforesaid complaint had been examined by the Standing Committee on Anti-profiteering in its meeting held on 15.05.2019.
Held by NAA
Whereas the Respondent was required to pass on the ITC benefit of Rs. 2,71,11,917/- (including GST), in respect of the period July 2017 to June 2019, in terms of provisions of Section 171 of the CGST Act, 2017, he has only passed on Rs. 2,67,88,794/- (including GST) to his homebuyers and that the remaining amount of ITC benefit that remains to be passed on to 20 homebuyers (as detailed in Table D of this Order amounts to Rs.7,14,837/- Hence we take the view that in compliance with the provisions of Section 171 of the CGST Act, 2017, the Respondent is required to pass on ITC benefit amounting to Rs. 7,14,837/- (inclusive of GST) to the twenty homebuyers as detailed at Sr. No. 3 of Table D of this Order. The Respondent is thus directed to pass on the above amount to the said homebuyers within a period of three months of this Order.
Further, it is also revealed from the submissions of the Respondent that he has not passed on interest @18% on the profiteered amount to his homebuyers, including Applicant No. 1 and the 20 homebuyers who are yet to receive the commensurate benefit. Hence, in line with the provisions of Section 171 (1) of the CGST Act, 2017 read with Rule 133 (3) (b) of the CGST Rules, 2017, we order that the applicable interest shall be paid by the Respondent to his homebuyers from the date of receipt of the additional amount of consideration in the hands of the Respondent till the amount is paid to each buyer, as the Respondent has used this amount in his business. Accordingly, the DGAP is directed to ensure that the interest, at the applicable rate, is paid to the eligible home buyers and submit his report confirming payment of the interest within three months of this Order. In case the interest is not paid the same shall be recovered by the concerned CGST/SGST Commissioner and paid to the eligible buyers.
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