Case Law Details
Sh. Ashish Jain through Sh. Rachit Jain Vs GLS Infraprojects Pvt. Ltd. (NAA)
In the present case the draw of lots, allotment of units and receipt of payments had taken place in the post-GST era. The draw of lots for allotment of houses was conducted on 08.08.2017 in the presence of the committee constituted under the Affordable Housing Policy, 2013. It is also revealed that an agreement was executed between the above Applicant No. 1 and 2 & the Respondent in which terms and conditions for allotment of the flat were settled only after the draw of flats on 08.08.2017 i.e post GST period. It is also apparent from the record that the Respondent had received the Environment Clearance from the State Environment Impact Assessment Authority Haryana on 21.07.2017 before which he could not have started the execution of the project. On the basis of the sequence of the above events, it could be safely concluded that the above project had been started after coming in to force of the GST w.e.f. 01.07.2017. It is also clear that the above Applicants were allotted flats only after coming in to force of the GST w.e.f. 01.07.2017. As project was launched after implementation of the GST w.e.f. 01.07.2017, apparently there was no pre-GST tax rate or input tax credit availability that could be compared with the post-GST tax rate and the input tax credit, to determine whether there was any benefit that was required to be passed on by way of reduced price. Also the Respondent has reduced the GST rate from 12% to 8% w.e.f. 25.01.2018, in terms of Notification No. 01/2018 Central Tax (Rate) dated 25.01.2018.
From the above facts it is established that there had been no additional benefit of ITC to the Respondent and hence he is not required to pass on the benefit to the above Applicants by reducing the prices of the flats. The Applicant No. 1 and 2 could have availed the above benefit only if the above project was under execution before coming into force of the GST as the Respondent would have been eligible to avail ITC on the purchase of goods and services after 01.07.2017 on which he was not entitled to do so before the above date. Since there is no basis for comparison of ITC available before and after 01.07.2017, the Respondent is not required to recalibrate the price of the flat due to additional benefit of ITC. Hence, the allegations of the Applicants made in this behalf are incorrect and therefore, the same cannot be accepted.
FULL TEXT OF ORDER OF NATIONAL ANTI-PROFITEERING AUTHORITY
The Present Report dated 27.11.2020 has been received from the Applicant No. 2 i.e. the Director General of Anti-Profiteering (DGAP) in response to the Authority’s Interim Order no. 23/2019 dated 26.12.2019 passed under Rule 133(4) of the Central Goods & Service Tax (CGST) Rules, 2017. The said order was issued to refer back the DGAP’s Report dated 25.06.2019 which was furnished by the DGAP after investigation under Rule 129 (6) of the Central Goods & Service Tax (CGST) Rules, 2017.
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