Case Law Details
Sh. Mohit Arora Vs M/s Lodha Developers Limited (National Anti-Profiteering Authority)
It is established from the perusal of the above facts of the case that the provisions of Section 171 of the CGST Act, 2017 have been contravened by the Respondents as they have profiteered an amount of Rs. 1,90,04,456/- inclusive of GST @ 12% on the base profiteered amount of Rs. 1,69,68,264/-. The Respondents have also realized an additional amount to the tune of Rs. 37,065/- from the Applicant No. 1 which includes both the profiteered amount @2.62% of the taxable amount (base price) and the GST on the said profiteered amount. Accordingly, the above amounts shall be paid to the above Applicant and the other eligible house buyers by the Respondents along with interest @18% from the date from which these amounts were realised from them till they are paid as per the provisions of Rule 133 (3) (b) of the CGST Rules, 2017.
In view of the above facts this Authority under Rule 133 (3) (a) of the CGST Rules, 2017 orders that the Respondents shall reduce the prices to be realized from the buyers of the flats commensurate with the benefit of ITC received by them as has been detailed above. Since the present investigation is only up to 08.2018 any benefit of ITC which accrues subsequently shall also be passed on to the buyers by the Respondents. In case this benefit is not passed on the Applicant No. 1 or any other buyer shall be at liberty to approach the State Screening Committee Maharastra for initiating fresh proceedings under Section 171 of the above Act against the Respondents. The concerned CGST or SGST Commissioner shall take necessary action to ensure that the benefit of additional ITC is passed on to the eligible house buyers in future.
It is also evident from the above narration of facts that the Respondents have denied benefit of ITC to the buyers of the flats being constructed by them in their Lodha Eternis Project in contravention of the provision of section 171(1) of the CGST Act, 2017 and have thus resorted to profiteering. Hence, they have committed an offence under section 171 (3A) of the CGST Act, 2017 and therefore, they are apparently liable for imposition of penalty under the provisions of the above Section. Accordingly, a Show Cause Notice be issued to them directing them to explain why the penalty prescribed under Section 171 (3A) of the above Act read with Rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on them.
The Respondents have themselves admitted that they have passed on the additional ITC benefit of Rs. 139,30,61,6891- in respect of 17 other projects being executed by the Respondents. They have also admitted the same before the DGAP vide Annexure-12 attached with the Report dated 08.11.2018.
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INSTANT
No denying that explains the plight customers are by and large faced with ; and, brings to laser sharp focus as to why the CA engaged for reporting/certifying under the GST law for its purposes, depending on the level of his individual professionalism and quality of courage of convictions – in essence for the ultimate benefit of the gullible ‘customer’- in respect of identified/ as well as not-so- identified / – discernible areas of challenges, in order to to save own ‘skin’, cover those with a suitably worded qualificatory NOTES to be appended to his Report/ Corticated. For such a purpose, one most crucial aspect to be taken care is that an inevitable ‘MISMATCH’ between the BOOKS of ACCOUNT (RECORDS) maintained by the realtor in the normal course of business on one hand (reported to be only ‘true and fair’) and the DATA as made available for examination /scrutiny on the other (to be reported/certified as ‘true/ correct and complete’) . For thoughts/ viewpoints personally shared suggest to, if so care and minded, look up the material of relevance in public domain ( mainly, on FB/LinkedIn Timelines !
(Left UN – Edited- Invite EXPERTS in GST practice to add Value)
Courtesy
(In Public Interest)
ATTN; ADMN./TGTeam
OFFHAND
Concerning the aspect of ITC requiring a deep examination/ devout scrutiny , for a CA engaged for audit report/ certification work, – as cautioned in earlier related Posts , there could be several areas posing grave challenge; therefore, might have to be kept in sharp focus.
The above cited Order in re. Sh. Mohit Arora Vs M/s Lodha Developers Limited (National Anti-Profiteering Authority), in a manner of conscious viewing, provides an insight into the not-so- obvious / or not-so- easily identifiable intricacies the exercise inescapably entails !
Courtesy