NAA directs DGAP to investigate the Profiteering charges against Pareena Infrastructure [Read Order]

The National Anti-profiteering Authority (NAA) directed the Director General of Anti-Profiteering (DGAP) to investigate the profiteering charges against Pareena Infrastructure.

The Applicant alleged profiteering by the Respondent, Pareena Infrastructure in respect of the purchase of Flat in his “Laxmi Apartments” project located in Gurugram, Haryana. The Applicant 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 flat after implementation of GST w.e.f. July 1, 2017.

The Adjudication Authority headed by Chairman B.N.Sharma directed the DGAP to investigate the present case under Rule 133 (4) of the CGST Rules, 2017 up to October 30, 2020, or till the date of issue of Completion Certificate, whichever is earlier, on various issues.

Firstly, the claim of the Respondent that he has passed on the ITC benefit amounting to Rs. 19,680 to Applicant and amounting to Rs. 1,54,87,120 to the 769 other buyers, needs to be verified by obtaining acknowledgments from approximately 10% (78 buyers) of the buyers selected randomly from the list of all homebuyers.

Secondly, the Respondent has claimed to have passed on ITC benefit amounting to Rs. 1,55,06,800 on account of profiteering for the period from July 2017 to June 2019. Therefore, he is also liable to pass on interest at the rate of 18% on the profiteered amount to the flat buyers from the dates from which he has received the additional amount of consideration from them till the passing on of the ITC benefit, as he has used this amount in his business, as per the provisions of Section 171 (1) of the CGST Act, 2017 read with Rule 133 (3) (b) of the above Rules. The DGAP is directed to investigate, compute and ensure that the applicable interest is also paid to all eligible house buyers.

“It is also directed that a detailed Report shall be submitted under Rule 129 (6) of the above Rules. It is further directed that copies of the Assessment Orders if any passed on the VAT and Service Tax liability of the Respondent during the period from April 2016 to June 2017 shall also be furnished along with the Report. If required the DGAP shall be at liberty to take assistance of the jurisdictional GST Authorities of the Central and the State Government, who are directed to extend all cooperation to the DGAP in terms of Rule 136 of the CGST Rules, 2018 and Para 38 of the “Methodology & Procedure” framed under 126 of the CGST Rules, 2017 notified on 28.03.2018 by this Authority. The respondent is also directed to extend all assistance to the DGAP during the course of further investigation of the present case,” the NAA said.

To Read the full text of the Order CLICK HERE