The Tribunal examined the DGAP report; found that ITC benefits were already passed to buyers; held no profiteering occurred; accepted the closure report; and dismissed the proceedings against the respondent company.
Kashish Bhardwaj | May 6, 2026 |
Builder Cleared of Profiteering Charges After Passing Excess ITC Benefit to Homebuyers: GSTAT
The New Delhi Bench of the Goods and Services Tax Appellate Tribunal (GSTAT) said that a developer did not violate anti-profiteering rules. The Tribunal found that the developer had already passed on input tax credit (ITC) benefits to homebuyers. In fact, the amount given was more than what is required under Section 171 of the CGST Act.
The Director General of Anti-Profiting is the petitioner who has filed the present appeal against Samridhi Realty Pvt. Ltd in the GST Appellate Tribunal Division Bench Court No. 2. It is being preferred under applicable clauses of the Central Goods & Service Tax Act 2017. The present appeal has been preferred against the order dated 2nd April 2026 of the Competent Authority under GST with reference number ZA070010426000008H.
The Tribunal noted that the complainants had received the amounts they claimed. They also confirmed receiving these payments. No other homebuyer raised any objection to the DGAP’s report dated December 5th, 2024.
The case involved flats booked in the “Samridhi Grand Avenue” project located in Greater Noida West. The homebuyers claimed that the developer did not pass on the benefit of extra ITC that became available after GST was introduced on 1st July 2017.
The DGAP carried out a fresh investigation after an order based on the Delhi High Court’s decision in Reckitt Benckiser India Pvt. Ltd. v. Union of India. During this review, the DGAP recalculated the amount of alleged profiteering.
The findings showed that the developer received an additional ITC benefit of 4.19% after GST came into effect. However, the developer had already passed on ITC benefits worth Rs. 16.45 crore to 935 homebuyers. This was much higher than the calculated profiteering amount of Rs. 6.59 crore.
The DGAP concluded that the developer passed on an extra benefit of Rs. 9.86 crore. This amount was above what is required under Section 171 of the CGST Act 2017.
At the hearing, the developer offered to settle the remaining amounts and interests owed to the two complainants. The complainants agreed to the offer. It is noted by the Tribunal that both complainants acknowledged the receipt of the adjusted amounts. Considering the foregoing, the Tribunal adopted the report of the closure made by the DGAP.
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