The Competition Commission of India (CCI) has dropped the Goods and Services Tax (GST) Anti-Profiteering proceedings against the assessee citing the absence of other executed projects besides “Bhagwati Eminence” which was already been Profiteered as determined by the National Anti-Profiteering Authority (NAA).
The decision in the case of M/s. Bhagwati Infra, Navi Mumbai comes after a detailed investigation by the Director General of Anti-Profiteering (DGAP) and a subsequent order from the NAA.
The case dates back to the first Investigation Report (FIR) filed by the DGAP on 04-11-2020, which revealed that the assessee, Bhagwati Infra had profiteered an amount of Rs. 1,56,77,149/- during the execution of the “Bhagwati Eminence” project.
The NAA determined the profiteered amount and directed the Respondent to pass on the benefit of Input Tax Credit (ITC) to the home-buyers.
Furthermore, the NAA, in the same order, also directed the DGAP to investigate profiteering in relation to other projects executed by Bhagwati Infra, if any, under the provisions of Section 171 of the Central Goods and Services Tax (CGST) Act, 2017.
The DGAP conducted a thorough investigation and the subsequent report was submitted to the CCI.
As per the report, the DGAP issued a notice to the Respondent asking whether the benefit of ITC had been passed on to customers of projects other than the “Bhagwati Eminence” Project through a reduction in prices.
The respondent, in response to the notice, stated that they had not undertaken any project other than “Bhagwati Eminence” and they provided supporting financial documents for the Financial Year (FY) 2021-22 to validate their claim.
The DGAP further cross-verified this information by checking the details of projects registered with the Maharashtra Real Estate Regulatory Authority (RERA) online.
It was confirmed that apart from “Bhagwati Eminence”, no other projects of the Respondent were registered with Maharashtra RERA.
The DGAP, to double-check the Respondent’s claim, also sent a letter to the jurisdictional Commissionerate, Belapur CGST Commissionerate, Navi Mumbai seeking information on any other projects executed by the respondent.
The Commissionerate affirmed that the Respondent had not undertaken any other projects apart from “Bhagwati Eminence”.
The DGAP concluded in his report that the Respondent had not executed any other construction project besides “Bhagwati Eminence” and Section 171(1) of the CGST Act, 2017, which requires the passing on of tax rate reduction benefits or ITC benefits to recipients through a commensurate reduction in prices, was deemed inapplicable in the case of the assessee.
In result, the CCI comprising Smt. Ravneet Kaur, Chairperson along with members Dr. Sangeeta Verma and Sh. Bhagwant Singh Bishnoi has dropped the GST Anti-Profiteering proceedings against the assessee based on the DGAP’s comprehensive investigation and corroborating evidence.
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