Vivek Gupta Vs Maheshwari Infratech Pvt Ltd (NAA)
NAA held that Maheshwari Infratech Pvt Ltd has denied the benefit of ITC to the customers/flat buyers/recipients in his Project U-Faria’ in contravention of the provisions of Section 171 (1) of the CGST Act, 2017 and has committed an offence under Section 171 (3A) of the above Act. Section 171 (3A) of the CGST Act, 2017 has been inserted in the CGST Act, 2017 vide Section 112 of the Finance Act, 2019, and the same became operational w.e.f. 01.01.2020. As the period of investigation was 01.07.2017 to 31.03.2019, therefore, penalty cannot be imposed on the Respondent retrospectively, i.e. for the period of investigation.
FULL TEXT OF ORDER OF NATIONAL ANTI-PROFITEERING AUTHORITY
1. The Present Report dated 29.10.2020 had been furnished by the Applicant No. 2 i.e. the Director General of Anti-Profiteering (DGAP), under Rule 133(4) of the Central Goods & Services Tax (CGST) Rules, 2017, in the case of M/s Maheshwari Infratech Pvt Ltd., A-6, Ground Floor, Yojna Vihar, Delhi-110092, in response to the Authority’s JO No. 16/2020 dated 20.04.2020 wherein the DGAP’s Report dated 24.09.2019 was referred back to reinvestigate the case under Rule 133(4) of the Central Goods and Service Tax Rules, 2017 and directed the DGAP to further investigate the present case on the following issues:
i) Whether the ITC amounting to Rs. 1,77,50,478/- had been blocked by the State GST authorities on 28.03.2019.
ii) Whether the above amount of ITC should be taken in to account while computing the profiteered amount during the period from 01.07.2017 to 31.03.2019.
iii) Whether the Respondent had passed on the benefit of Rs. 9,61,130/- as ITC benefit to the shop buyers during the period from 01.07.2017 to 31.03.2019.
iv) Whether the Respondent had passed on an amount of Rs. 95,205/- as ITC benefit to the Applicant 1.
2. The DGAP vide report dated 24.09.2019 reported that an application dated 29.11.2018 was filed before the Standing Committee on Anti-profiteering, under Rule 128 (1) of the CGST Rules, 2017 by the Applicant No. 1 alleging profiteering in respect of construction service supplied by the Respondent. The above Applicant had submitted that he had purchased Shop No. G-122 in the Respondent’s commercial project “U FARIA”, situated at C-04A, Sector-16B, Greater Noida, Uttar Pradesh and had alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) to him by way of commensurate reduction in price of the shop. The above application was examined by the Standing Committee on Anti-profiteering, in its meeting held on 11.03.2019, the minutes of which were received by the DGAP on 27.03.2019, whereby it was decided to forward the same to the DGAP to conduct a detailed investigation in the matter. Accordingly, it was decided by the DGAP to initiate an investigation and collect evidence necessary to determine whether the benefit of ITC had been passed on by the Respondent to the Applicant No. 1 in respect of the construction service supplied by the Respondent.
i. Thereafter, the DGAP had issued Notice to the Respondent on 08.04.2019 under Rule 129 (3) of the above Rules, calling upon him to reply as to whether he admitted that the benefit of ITC had not been passed on to the Applicant No. 1 by way of commensurate reduction in price and if so, to suo moto determine the quantum thereof and indicate the same in his reply to the Notice as well as furnish all supporting documents. The Respondent vide the said Notice, was also given an opportunity to inspect the non-confidential evidence/information furnished by the Applicant No. 1 during the period from 10.04.2019 to 12.04.2019, which the Respondent did not avail of. The Applicant No. 1 vide e-mail dated 17.09.2019 was also afforded an opportunity to inspect the non-confidential documents/reply furnished by the Respondent on 18.09.2019 or 19.09.2019, which the Applicant No. 1 also did not avail of. The DGAP has also stated that the period covered by the current investigation was from 01.07.2017 to 31.03.2019 and the time limit to complete the investigation was extended upto 26.09.2019 by this Authority, vide its order dated 19.06.2019, in terms of Rule 129 (6) of the above Rules.
ii. The DGAP informed that the Respondent has submitted a copy of the Project Report of the “U Faria” project and the payment schedule for the purchase of shops. The Respondent, vide his letter dated 29.05.2019 and subsequent letter, submitted copies of the demand letters issued to the Applicant No. 1. The details of the payment plan of the Applicant No. 1 to the Respondent are furnished in Table-A below:-
Table-`A’
