GST Update

Desk of CA. Praveen Sharma – 970 Series (CAPS)

GSTAT Delhi (PB) in the case of DG Anti Profiteering, Director General of Anti-Profiteering (DGAP)

In this case, a real estate developer was examined for not passing on the benefit of increased input tax credit to homebuyers after implementation of GST.

It was observed that the developer received additional tax benefit but did not reduce the prices accordingly, leading to excess recovery from buyers.

The developer later accepted the findings and refunded the amount to customers. Considering this timely compliance, no penalty was imposed.

However, the authority held that interest is still payable since the benefit was not passed on at the appropriate time. Interest is treated as compensation for delay.

Accordingly, the developer was directed to pay the remaining amount along with applicable interest to all eligible homebuyers.

The ruling reinforces that tax benefits must be passed on in a timely manner, failing which refund along with interest becomes mandatory.

LINK:CA. Praveen Sharma on Linkedin

Regards
CAPS