Case Law Details
Santosh Kumari through Saurabh Prabhakar Vs Aster Infrahome Pvt. Ltd. (NAA)
It is also revealed from the perusal of the CGST Act and the Rules framed under it that the Central Government vide Notification No. 01/2020-Central Tax dated 01.01.2020 has implemented the provisions of the Finance (No. 2) Act, 2019 from 01.01.2020 vide which sub-section 171 (3A) was added in Section 171 of the CGST Act, 2017 and penalty was proposed to be imposed in the case of violation of Section 171 (1) of the CGST Act, 2017.
Since, no penalty provisions were in existence between the period w.e.f. 01.07.2017 to 31.12.2018 when the Respondent had violated the provisions of Section 171 (1), the penalty prescribed under Section 171 (3A) cannot be imposed on the Respondent retrospectively. Accordingly. the notice dated 04.02.2020 issued to the Respondent for imposition of penalty under Section 171 (3A) is hereby withdrawn and the present penalty proceedings launched against him are accordingly dropped.
FULL TEXT OF ORDER OF NATIONAL ANTI-PROFITEERING AUTHORITY
1. The brief facts of the present case are that the Applicant No. 2 (herein-after referred to as the DGAP) vide his Report dated 28.02.2019, furnished to this Authority under Rule 129 (6) of the Central Goods & Services Tax (CGST) Rules, 2017, had submitted that he had conducted an investigation on the complaint of the Applicants No. 1 to 12 and found that the Respondent had not passed on the benefit of additional Input tax Credit (ITC) to the above Applicants as well as other home buyers who had purchased Flats in his Project “Green Court”, as per the provisions of Section 171 (1) of the CGST Act, 2017. Vide his above Report the DGAP had also submitted that the Respondent had denied the benefit of ITC to the above buyers amounting to Rs. 5,30,34,074/-, pertaining to the period w.e.f. 01.07.2017 to 31.08.2018 and thus had indulged in profiteering and violation of the provisions of Section 171 (1) of the above Act.
2. This Authority after careful consideration of the Report dated 28.02.2019 had issued notice dated 05.03.2019 to the Respondent to show cause why the Report furnished by the DGAP should not be accepted and his liability for violation of the provisions of Section 171 (1) should not be fixed. After hearing both the parties at length this Authority vide its Order No. 57/2019 dated 19.11.2019 had determined the profiteered amount as Rs. 5,30,34,074/- as per the provisions of Section 171 (2) of the above Act read with Rule 133 (1) of the CGST Rules, 2017 pertaining to the period from 01.07.2017 to 31.08.2018 and also held the Respondent in violation of the provisions of Section 171 (1) of the above Act.
3. It was also held that the Respondent had denied the benefit of ITC to the buyers of the flats being constructed by him in contravention of the provisions of Section 171(1) of the CGST Act, 2017 and he had thus committed an offence as per the provisions of Section 171(3A) of the CGST Act, 2017 and therefore, the Respondent was liable for imposition of penalty under Section 171(3A) of the above Act.
4. The Respondent was issued notice dated 27.12.2019 asking him to explain why the penalty mentioned in Section 171(3A) of the CGST Act, 2017 read with Rule 133 (3) (d) of the CGST Rules, 2017 should not be imposed on him.
5. The Respondent was given opportunity for hearing or to file his written submissions, if any, on 19.02.2020 and 13.03.2020. The Respondent did not avail any of these opportunities and further requested for adjournment of hearing telephonically. However, no written submissions have been received from the Respondent till date.
6. We have carefully considered all the material placed before us and it has been revealed that the Respondent has not passed on the benefit of additional Input tax Credit (ITC) to the above Applicants as well as other homebuyers who have purchased them in his Project “Green Court” for the period from 01.07.2017 to 31.08.2018 and hence, the Respondent has violated the provisions of Section 171 (1) of the CGST Act, 2017.
7. It is also revealed from the perusal of the CGST Act and the Rules framed under it that the Central Government vide Notification No. 01/2020-Central Tax dated 01.01.2020 has implemented the provisions of the Finance (No. 2) Act, 2019 from 01.01.2020 vide which sub-section 171 (3A) was added in Section 171 of the CGST Act, 2017 and penalty was proposed to be imposed in the case of violation of Section 171 (1) of the CGST Act, 2017.
8. Since, no penalty provisions were in existence between the period w.e.f. 01.07.2017 to 31.12.2018 when the Respondent had violated the provisions of Section 171 (1), the penalty prescribed under Section 171 (3A) cannot be imposed on the Respondent retrospectively. Accordingly. the notice dated 04.02.2020 issued to the Respondent for imposition of penalty under Section 171 (3A) is hereby withdrawn and the present penalty proceedings launched against him are accordingly dropped.
9. Copy of this order be supplied to both the parties. File be consigned after completion.
