DG Anti Profiteering Vs PRL Developers (GSTAT)
The proceedings arose from a complaint filed by Shri Diwakar Bansal under Rule 128 of the Central Goods and Services Tax Rules, 2017 alleging that M/s PRL Developers Pvt. Ltd. had failed to pass on the benefit of additional Input Tax Credit (ITC) by way of commensurate reduction in price in respect of Flat No. T1-507 in the project “Piramal Revanta Tower-1”, thereby contravening Section 171 of the CGST Act, 2017. The Standing Committee on Anti-Profiteering examined the complaint and referred the matter to the Directorate General of Anti-Profiteering (DGAP) for investigation under Rule 129 of the CGST Rules.
The DGAP initially investigated the matter and submitted a report dated 25.02.2023. While the report was pending before the Competition Commission of India (CCI), the Delhi High Court delivered its judgment in Reckitt Benckiser India Pvt. Ltd. v. Union of India, following which the CCI remanded the matter to the DGAP for re-investigation. A fresh notice dated 08.04.2024 was issued to the Respondent, who furnished replies and supporting documents on various dates. The DGAP thereafter submitted a fresh report dated 13.12.2024.
The DGAP investigated the period from 01.07.2017 to 31.03.2023. It observed that before GST, the Respondent could avail CENVAT credit of service tax on input services, whereas after GST it became eligible to avail ITC on inputs and input services. Based on the ratio of credit availed to purchase value, the DGAP found that the ratio increased from 14.00% during the pre-GST period to 16.10% during the post-GST period, resulting in an additional ITC benefit of 2.10%. The corresponding base profiteered amount was computed at Rs. 39,00,226 (excluding GST).
