The National Anti- Profiteering Authority (NAA), has found Prestige Estates guilty of not passing the right amount of ITC to home buyers and imposed a penalty under section 171 (3A) of the CGST Act, 2017.
It was alleged that the Input Tax Credit availability on post-GST and the details of the amount collected from the home buyers by the respondent during the period 01.07.2017 to 30.09.2019, the amount of benefit of ITC was not passed on to the recipients, where the profiteered amount comes to Rs. 7,90,95,475/- in respect of 452 homebuyers.
The Respondent claimed that he had already passed a substantial amount of GST ITC per the requirements of Section 171 of the CGST Act, 2017 to the homebuyers and also passed on excess ITC benefits to his buyers/customers.
The DGAP found that Respondent has not passed commensurate benefits to all homebuyers/customers which was agreed by the Authority. As per Section 171 of the CGST Act, 2017 benefit of the ITC needs to be provided to every supply in a commensurate manner. It was observed that the excess of the ITC benefit provided to some of the homebuyers/customers cannot be offset against others to whom less ITC benefit has been provided or no benefit has been provided at all.
It was observed that the DGAP has made all efforts towards verification in terms of Order No. 01/2021 dated 16.032021 of the Authority, but, the Respondent was unable to provide the requisite evidence which was directed in the Order and concluded that the Respondent has profiteered an amount of Rs. 7,90,95,475/-.
The Authority held that under Rule 133(3)(a) of the CGST Rules, the Respondent shall reduce the prices to be realized from the buyers of the Flats/customers commensurate with the benefit of ITC received by him.
The Coram consist of Sh. Amand Shah, Chairman & Technical Member, Sh. Pramod Kumar Singh, Technical Member and Sh. Hitesh Shah, Technical Member directed that “the profiteered amount as determined shall be passed on/returned by the Respondent to the recipients of supply along with interest @18%, as prescribed under Rule 133(3)(b) of the CGST Rules, 2017, from the date such amount was profiteered by the Respondent up till the date such amount was passed on/returned to the respective recipient of the supply (if not already passed on) within a period of three months from the date of this order.”
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