Claim on Non-Passing of ITC Benefit ends with NCLT Order Which Extinguishes Liability: CCI directs to Drop Anti Profiteering Proceedings Against Puma Realtors
Claim on Non-Passing of ITC Benefit ends with NCLT Order Which Extinguishes Liability – ITC – NCLT – Anti Profiteering Proceedings – CCI – Puma Realtors – Taxscan
Claim on Non-Passing of ITC Benefit ends with NCLT Order Which Extinguishes Liability – ITC – NCLT – Anti Profiteering Proceedings – CCI – Puma Realtors – Taxscan
The Competition Commission of India (CCI) directed to drop anti-profiteering proceedings against Puma Realtors since the claim on non-passing of Input Tax Credit (ITC) benefit ends with National Company Law Tribunal(NCLT) order which extinguishes the liability.
The respondent submitted that the Resolution Plan, as approved by the NCLT, shall in terms of Section 31 of the Insolvency and Bankruptcy Code 2016 (“Code") have a binding effect upon the debts of the Respondent including the dues of the Central Government, any State Government or any local authority to whom debt in respect of the payment of dues arising under any law for the time being in force, was owed.
The claims/benefit could not be quantified because of the non-submission of the documents by the Respondent. Further, any claim on Respondent would stand extinguished in view of the order of NCLT dated 01.06.2021.
The Resolution Applicant (M/s One Group Developers) cannot be held accountable for the action of M/s. Puma Realtors Pvt. Ltd. in not passing on the benefit of ITC to the eligible recipients under Section 171 of the CGST Act, 2017 after Resolution Plan had been approved by the NCLT Accordingly the proceedings initiated vide letter dated 25.08.2022 could not be continued against the Respondent.
The Commission comprising Bhagwant Singh Bishnoi, Ravneet Kaur, Jyoti Jindga Bhanot, and Sangeeta Verma observed that “any claim of not passing on the benefit of ITC to the recipients under Section 171 of the CGST Act and the Rules made there under, would not survive in view of the Order dated 01.06.2021 passed by the NCLT under Section 31 of the Code which extinguishes his all liabilities including any liability on account of passing on the benefit of ITC to the recipients of the Project Ireo Rise as the same has not been incorporated in the Approved Resolution Plan.”
The Commission held that “the proceedings already initiated against the Respondent for determining the benefit of Input Tax Credit under Section 171 of the CGST Act, 2017 and rules made there under, about the project lreo Rise, shall be discontinued.”
Further revealed that “the CC has not been issued to date in respect of this project and it is still under execution. Hence M/s One Group Developers is liable for passing on the benefit of ITC under the provisions of Section 171 of the CGST Act and Rules made there under as it is availing the benefit of ITC Therefore, the DGAP is directed to investigate M/s One Group Developers about the project ’lreo Rise’ for any violation of Section 171 Of the CGST Act, 2017 and the Rules.”
To Read the full text of the Order CLICK HERE
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