Case Law Details
Manish Saini Vs Ramaprastha Promoter & Developer Pvt. Ltd. (NAA)
It is clear from the plain reading of Section 171(1) mentioned above that it deals with two situations one relating to the passing on the benefit of reduction in the rate of tax and the second pertaining to the passing on the benefit of the ITC. On the issue of reduction in the tax rate, it is apparent from the DGAP’s Report that there has been no reduction in the rate of tax in the post GST period; hence the only issue to be examined is as to whether there was any net benefit of ITC with the introduction of GST. On this issue it has been revealed from the DGAP’s Report that the ITC as a percentage of the turnover that was available to the Respondent during the pre-GST period (April-2016 to June-2017) was 1.72% and during the post-GST period (July-2017 to December-2018), it was 2.64%. This confirms that, post-GST, the Respondent has been benefited from additional ITC to the tune of 0.92% (2.64%1.72%) of his turnover and the same was required to be passed on to the Applicant No. 1 and the other flat buyers. The DGAP has calculated the amount of ITC benefit to be passed on to all the flat buyers as Rs. 35,28,744/- on the basis of the information supplied by the Respondent, which the Respondent had himself admitted and hence the amount of profiteering computed by the DGAP is hereby accepted as correct.
In view of the discussions in para 33 above, it is clear that the Respondent has profiteered by an amount of Rs. 35,28,744/-(Annex-17) during the period of investigation i.e. 01.07.2017 to 31.12.2018. The above amount of Rs. 35,28,744/- (including 12% GST) that has been profiteered by the Respondent from his home buyers, including Applicant No. 1, shall be refunded by him, along with interest @18% thereon, from the date when the above amount was profiteered by him till the date of such payment, in line with the provisions of Rule 133 (3) (b) of the GCST Rules 2017.
We also take note of the fact that the Respondent has admitted to having profiteered by the above amount before this Authority vide his submissions dated 03.07.2019. Further, we observe that vide his submissions dated 20.08.2019, he has submitted sample credit notes and cheques as evidence to establish his claim of having passed on the benefit, amounting to Rs. 35,28,744/- along with interest thereon amounting to Rs. 7,32,220/- to 397 home buyers of ‘Edge Tower’. Accordingly, this Authority takes on record the said claim of the respondent, but the said payments need to be verified.
Thus the DGAP is directed to verify the above passing on of the ITC benefit and submit report within a period of 03 months from the passing of this order.
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