The instant Report dated 28.08.2020, received on 31.08.2020 has been furbished by Applicant No. 17 i.e. Director General of Anti-Profiteering (DGAP) under Rule 129(6) of the Central Goods and Services Tax Rules. 2017. The brief facts of the present case, are that a reference was received on 30.08.2018 by the DGAP from the Standing Committee on Antiprofiteering to conduct a detailed investigation under Rule 129 of the Rules 2017, based on two applications dated 17.072018 and 12.05.2018 filed by Applicant No. 1 and Applicant No. 2 respectively in respect of the purchase of fiats in the Respondent’s project “Zara Aavaas” (hereinafter referred to as “the Project”) located at Gurugram. Haryana. forwarded by the Haryana State Screening Committee on Anti-profiteering. under Rule 128 of the Rules 2017, wherein it prima facie observed that Section 171 Of the Central Goods and Services Tax Act, 2017 had been contravened.

2. The DGAP had issued a Notice dated 12.09.2018 under Rule 129 of the CGST Rules 2017, calling upon the Respondent to reply as to whether he admitted that the benefit of input tax credit had not been passed on to the Applicant No. 1 and Applicant No, 2 by way of commensurate reduction in prices and if so, to suo moto determine the quantum thereof and indicate the same in his reply to the Notice as well as furnish all supporting documents.

3. Later on, 14 (fourteen) more applications filed by Sh. Rohit Choudhary (application dated 18.07.2018), Sh. Narendra Pal Singh (application dated 21.10.2018), Sh. Gaurav Kumar Singla (application dated 20.09.2018), Ms Neelu Jain (application dated 20.09.2018). Sh. Arvind Mahto (application dated 20.09.2018), Sh, Sidharth Shanker Rai (Application dated 21.09.2018), Sh. Deepak Murthy (application dated 2109.2018), Sh. Pradeep Rawat (application dated 2209.2018), Ms. Sonal Kansai (application dated 29.092018), Sh. Rahul Sharma (application dated 03.102018). Ms. Priyanka Tuteja (application dated 03.10.2018). Sh. Rajeev Kumar (application dated 04.10.2018), Ms Lata Rani (application dated 07.10.2018), and Ms. Supriya Mandi (application dated 12.11.2018) were forwarded subsequently by the Standing Committee on Anti-Profiteering against the Respondent, to DGAP and the above 14 Applicants were also made co-applicants in the investigation being carried out by the DGAP.

4. upon receipt of the reference from the Standing Committee. the DGAP has conducted a detailed investigation into the matter and submitted his Investigation Report dated 27.02.2019 to this Authority.

5. This Authority, considering the above said Report in its meeting held on 05.03.2019. had issued the Notice dated 06.03.2019 to the Respondent enclosing the aforesaid Report, directing him to explain why the aforesaid Report of the DGAP should not be accepted and his liability for profiteering should not be determined under section 171 of the CGST Act 2017.

6. Accordingly, the Respondent vide his letters dated 25.03.2019. 10.04.2019, 16.05.2019. 17.05.2019, 05.07.2019. and 25.07.2019 as well as the Applicant No. I vide letter dated 29.03.2019 had furnished their replies to the aforesaid Report of the DGAP.

7. This Authority after careful examination of the DGAP’s Reports. the submissions/replies of the Respondent and the Applicants. and also all other documents placed on record, had observed that the Respondent had executed a Project i.e. “Zara Aavaas” under the Haryana Affordable Housing Policy-2013 which had commenced during the financial year 2015-16. The Respondent had constructed 818 flats in the said Project out of which 806 were booked in the pre-GST period and no new bookings were made in the post-GST period. Demands were raised on 806 home buyers during the pre-GST period as well as the post-GST period. Therefore. the DGAP has claimed that the computation of profiteering was for only those fiats where demands have been raised or payments have been received in the post-GST period. It was further claimed that if the ITC in respect of the unsold flats or the flats in respect of which no consideration has been received in the post-GST period, was taken into account to calculate profiteering in respect of the flats where payments were received in the post-GST period, the ITC as a percentage of turnover would be distorted and erroneous. therefore, the profiteering in respect of the remaining 12 units should be calculated when the consideration was received in the post-GST period. by taking into account the proportionate ITC in respect of these 12 units. It was also noted that since the construction service was being provided by the Respondent under affordable housing, which was exempted from the Service Tax in terms of Notification No. 25/2012 ST dated 20.06.2012 as amended vide Notification No. 09/2016-ST dated 01.03.2016, the Respondent was not eligible to avail Cenvat Credit on Service Tax and Central Excise Duty paid on input services, inputs. and capital goods. Moreover. as the Respondent was paying VAT @ 1% under the Haryana VAT composition Scheme, hence he was not eligible for availing of Credit of VAT paid on inputs. whereas, in the post-GST period, the Respondent was eligible to avail of Input Tax Credit (ITC) on GST paid on inputs. capital goods and input services including those paid by sub contractors. Consequently. the Respondent had benefited from additional ITC @ 7.13% of the turnover during the period from 01.07.2017 to 31.08.2018 (i.e. the investigation period), Which amounted to the tune of Rs. 3,80,38,835/- including GST (@ 12%/8%) on the base amount of Rs. 3.45,90.507/- which was required to be passed on to eligible home buyers in light of section 171 of the CGST Act 2017.

8. After going through the Report dated 27.02.2019, the Authority noted that the Report of the DGAP was not complete and needed to be revisited to rectify certain mistakes in the computation including the amount of the benefit to be passed on to Applicants No. 1 to 16. Accordingly, this Authority ordered DGAP to reinvestigate the matter vide its Interim Order No. 17/2019 dated 02.12.2019 in terms of Rule 133 (4) of the CGST Rules, 2017 and to recompute the profiteering for the entire period up to the date of issue of the Completion/ Occupancy Certificate or till 31.03.2019 in case the Completion/ Occupancy Certificate was yet to be issued

9. Consequent to the above, the DGAP re-investigated the matter and submitted his Report dated 28.08.2020. wherein he has reported that-

a) as per directions of this Authority contained in the Interim Order, vide DGAP letter dated 18.122019. asked the Respondent for the details required to extend the period of investigation up to issue of Occupancy Certificate, if issued, else up to 31.03.2019.

b) upon the directions of this Authority as the investigation report was to be submitted within 3 months. the DGAP has reported that the time limit to complete the investigation was extended up to 02.04.2020 by this Authority vide order dated 04.03.2020 and given the spread of pandemic Covid-19 across India, the Central Government, had issued Notification No. 35/2020 dated 03.04.2020, whereby the time limit for completion or compliance of any action, Which fell during the period from 20^th day of March 2020 to the 29^th day of June 2020 and where completion or compliance of such action has not been made within such time, then the time limit for completion or compliance of such action, was extended up to the 30th day of June 2020 including for furnishing of any report under the provisions of the Central Goods and Service Tax Act. 2017. Subsequently. given the Notification 55/2020, Central Tax dated 27.06.2020. the time limit stood extended till 31.082020.

c) the period covered by the current investigation is from 01.07.2017 to 31.03.2019.

d) in response to his above-said letter dated 18.12.2019. the Respondent has furnished his replies vide letters/e-mails dated 15.01.2020. 04.02.2020, 06.02.2020, 26.02.2020. 0203.2020, and 03.03.2020 wherein he has provided the following documents/information:

i. List of home-buyers.

ii. Month-wise details of Demand Raised.

iii. Reconciliation of demands with GST returns.

iv. Copies of GSTR from July 2017 to November 2019.

v. Summary of ITC availed which was not available earlier.

vi. Details of tax paid on purchases of Cement. Steel. and other items in pre-GST and post-GST period.

vii. Details of Contractor and taxes paid to them in pre-GST and post-GST period.

viii. Details of GST benefits passed on to the Home-buyers through Credit Notes.

ix. Copies of invoices of Cement, Steel, and Contractors in pre-GST and post-GST periods.