DG Anti Profiteering Vs MM Construction (GSTAT)
The proceedings arose from a complaint alleging that the Respondent failed to pass on the benefit of additional Input Tax Credit (ITC) in respect of a residential project at Lake Gardens, Kolkata, by way of commensurate reduction in price after the introduction of GST with effect from 01.07.2017, as required under Section 171 of the Central Goods and Services Tax Act, 2017. Following investigation by the Directorate General of Anti-Profiteering (DGAP), the matter ultimately came before the Principal Bench of the GST Appellate Tribunal (GSTAT) for adjudication.
Also Read: ITC Benefit Must Be Passed Through Price Reduction, Not Free Construction: GSTAT
The DGAP investigated the period from 01.07.2017 to 02.01.2020, being the date of receipt of the Occupancy Certificate. It found that while the Respondent was not eligible to avail any input tax credit in the pre-GST regime, it became entitled to ITC on inputs and input services after implementation of GST. Based on the project data, the DGAP computed additional ITC benefit of ₹7,31,160 attributable to the sold flats. Including GST at 12% amounting to ₹87,739, the total profiteered amount was determined at ₹8,18,899, which, according to the DGAP, was required to be passed on to the eligible homebuyers.
