2026-VIL-40-GSTAT-DEL-NAPA
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  2. 2026-VIL-40-GSTAT-DEL-NAPA

SGST Tribunal

GST - Anti-profiteering – Relevant date for reckoning of Project completion date – Whether, for the purposes of Section 171 of the CGST Act, 2017, project completion should be reckoned from the date of actual issuance of Occupancy Certificate or from the date of filing of application seeking such certificate – HELD - A project is deemed to be completed only upon actual grant of Occupancy Certificate from the competent authority and not upon mere filing of an application therefor - The submission that construction was completed on filing of application for Occupancy Certificate is devoid of merit - In the present case Occupancy Certificate was granted during the post-GST period and the Respondent continued to avail Input Tax Credit during the relevant period which clearly establishes that the project was ongoing in the post-GST period - The contention is rejected - Period of investigation for Anti-profiteering matter - Methodology for Computation of profiteered amount - Whether the DGAP correctly restricted the period of investigation to the period from introduction of GST till issuance of Occupancy Certificate and whether the methodology adopted for computation of profiteered amount is legally sustainable as per Section 171 – HELD – The Schedule III and Section 17 of CGST Act make it evident that sale of units after issuance of Occupancy Certificate is treated as exempt supply and falls outside purview of taxable supply and ITC attributable to such supplies is not available and is liable to be reversed - Since anti-profiteering provisions operate only where benefit of input tax credit accrues to supplier and is required to be passed on to recipients, no profiteering can arise in respect of units sold after issuance of Occupancy Certificate as no admissible input tax credit benefit survives in relation to such units - Investigation must be confined to period up to date of issuance of Occupancy Certificate - The DGAP correctly restricted the period of investigation to the relevant period representing duration during which project was ongoing and supplier was availing input tax credit under GST regime – The buyers had booked units and made payments during pre-GST period and became entitled to benefit of additional Input Tax Credit accruing to Respondent in post-GST period - DGAP correctly computed additional ITC benefit by comparing ratio of ITC to purchase value in pre-GST and post-GST periods. The methodology is in conformity with Section 171 of CGST Act and consistent with principles enunciated by Delhi High Court - No infirmity can be found in methodology or in quantification of profiteered amount - Identifiability of recipients - Rule 133(3)(b) and Rule 133(3)(c) – HELD - Rule 133(3)(c) is residuary provision attracted only in those cases where eligible recipients are genuinely unidentified. Expression “recipient is not identifiable” cannot be interpreted to mean recipient has not filed complaint, is not presently available or that computation has not initially been made buyer-wise - Test under Rule 133(3)(c) is one of objective impossibility of identification - Where supplier's books of account, allotment letters, agreements for sale, demand notices, payment schedules and statutory records disclose identity of purchasers, recipients remain identifiable notwithstanding that they may not have participated in proceedings or may presently be untraceable or may have resold their flats - In present case Respondent is real estate developer engaged in sale of residential flats and nature of such transactions necessitates maintenance of exhaustive records of each homebuyer. Respondent itself relied upon buyer-specific data and categorised purchasers according to stage and timing of payments received. Such stand itself demolishes contention that recipients are unidentifiable - Factual matrix falls squarely within ambit and scope of clause (b) of sub-rule (3) of Rule 133 of CGST Rules - Respondent having collected excess consideration from homebuyers in contravention of Section 171 cannot be permitted to retain same - Respondent is directed to refund profiteered amount to respective homebuyers individually along with interest at rate of eighteen per cent per annum calculated from date of collection of excess amount from each homebuyer until date of actual restitution - Penalty under Section 171(3A) of CGST Act - Whether Respondent is liable to pay penalty under Section 171(3A) – HELD - Since period of investigation in present case has been restricted to period from introduction of GST till issuance of Occupancy Certificate which is prior to coming into force of Section 171(3A), penalty provision is not attracted for period of investigation - It is well-settled principle of law that penal provisions cannot be applied retrospectively unless expressly stated - Section 171(3A) was inserted with effect from specified date and does not contain any provision for retrospective application - For period prior to coming into force of Section 171(3A), Respondent cannot be held liable for penalty under said provision - Respondent is not liable to pay penalty under Section 171(3A) of CGST Act.
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