GST: Pivotal Infrastructure guilty for not passing ITC benefit to Flat Buyers, says NAA [Read Order]

The National Anti-Profiteering Authority (NAA) imposed 18% interest on Pivotal Infrastructure for not passing ITC benefit to Flat Buyers.

The Applicant had alleged profiteering by the Respondent, Pivotal Infrastructure in respect of the purchase of Flats in his ‘Paradise’ project located in Gurgaon. The Applicants had also alleged that the Respondent had not passed on the benefit of Input Tax Credit (ITC) availed by him by way of commensurate reduction in the price of the above flats.

The NAA noted that the Respondent has passed on the benefit of Rs. 2,06,88,394 to his buyers on account of ITC which has been duly confirmed by the DGAP.

However, the Authority directed the Respondent to pass on the balance benefit of ITC of Rs.19,40,731 to the remaining 148 residential flat buyers and Rs.5,67,310 to the remaining 9 commercial shop buyers.

The NAA headed by the Chairman Dr.B.N. Sharma directed the respondent to pass on an aggregate amount of Rs. 25,08,041 to the 157 buyers along with the interest at the rate of 18% per annum from the dates from which the above amount was collected by him from them till the payment is made, within a period of 3 months.

Therefore, the Authority held that the respondent has contravene the provisions of Section 171 (1) of the CGST Act, 2017 and he has thus resorted to profiteering.

The NAA said that  the respondent has committed an offence under Section 171 (3A) of the CGST Act, 2017, and therefore, he is liable for imposition of penalty.