Mazars Tax Update | Edition 04.19

Indirect Tax News

National Anti-Profiteering Authority (NAA):  In case of M/s Gurukripa Developers and Infrastructures Pvt. Ltd. held that:

1. In case benefit of ITC has been passed to one of the applicants, benefit on same lines must be passed on to other recipient’s as well who are not an applicant under current proceedings.
2. In case short benefit is passed on to the customers, the company is liable to pay interest. Further, penalty u/s 122(1)(i) of CGST Act,2017 may be invoked basis issuance of incorrect tax invoices.

Facts

• Price of flat has been increased post GST and benefit of ITC has not been passed on by way of commensurate reduction in price.

 
Respondent Plea-

• Respondent has suo moto admitted that there has been benefit of ITC post GST implementation and such benefit has been passed on to the applicants.

 
Highlights of NAA’s Order-

• Short benefit has been passed on to the applicant as compared to the benefit quantified as per DGAP’s report.
• Benefit of ITC is required to be passed on to other buyers of flat as well who have not filed a complaint.
• Interest liability@18% shall arise from the date from which above amount has been profiteered.
• Penalty proceedings u/s 122(1)(i) of CGST Act,2017 has been initiated on the basis of issuance of incorrect tax invoices to the applicants due to excess realization from the applicants.

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