DG Anti Profiteering Vs Ahmedabad East Infrastructure LLP (GSTAT)
The proceedings under Section 171 of the Central Goods and Services Tax Act, 2017 were initiated based on a complaint alleging that the developer failed to pass on the benefit of Input Tax Credit (ITC) through a commensurate reduction in prices of a residential unit after the introduction of GST. The Standing Committee on Anti-Profiteering referred the matter to the Directorate General of Anti-Profiteering (DGAP) for investigation.
The DGAP conducted an investigation for the period from 01.07.2017 to 31.05.2025. It was found that the developer did not opt for the concessional GST scheme of 5% without ITC introduced from 01.04.2019 and instead continued under the 12% GST regime with ITC benefits. Prior to GST, the developer was not eligible to claim credit of Service Tax and CENVAT in respect of the project. However, in the post-GST regime, the developer became eligible to claim ITC on inputs and input services.
The project consisted of 180 villas, out of which 91 villas fell within the scope of investigation as they were either constructed or booked during the pre-GST period. The developer availed ITC amounting to ₹13.79 crore during the post-GST period and reversed ₹5.60 crore, resulting in a net ITC of ₹8.18 crore, as verified through CA-certified documents and returns.
