DG Anti Profiteering Vs Emaar India Ltd. (GSTAT)
The proceedings arose from a complaint filed under Rule 128 of the CGST Rules, 2017 alleging that the respondent developer had not passed on the benefit of additional Input Tax Credit (ITC) following the introduction of GST to purchasers of flats in its “Gurgaon Greens” project, as required under Section 171 of the CGST Act, 2017. The Standing Committee referred the matter to the Directorate General of Anti-Profiteering (DGAP), which conducted an investigation. After the Delhi High Court’s judgment in Reckitt Benckiser India Pvt. Ltd., the Competition Commission of India remanded the matter to the DGAP for fresh investigation. Following re-investigation, the DGAP submitted its report to the Principal Bench of the GST Appellate Tribunal (GSTAT).
The DGAP investigated the period from 1 July 2017 to 16 July 2019, being the period from implementation of GST until receipt of the Occupancy Certificate. The project comprised 642 residential units, of which 577 homebuyers were considered for profiteering computation. The DGAP found that the ratio of credit availed to purchase value increased from 9.41% in the pre-GST period to 11.85% in the post-GST period, resulting in an additional ITC benefit of 2.44%. Applying this methodology, it determined a base profiteered amount of ₹3,12,26,983, which after adding GST of ₹37,47,238 resulted in a total profiteered amount of ₹3,49,74,221. The DGAP also found that although the respondent had passed benefits to several homebuyers, a balance amount of ₹67,32,464 (including GST) remained payable to 232 identifiable recipients.
