DG Anti Profiteering (DGAP) v. Sobha Limited

Background of the Case

This case arose from allegations made by certain homebuyers against Sobha Limited, a prominent real estate developer, alleging violation of the anti-profiteering provisions contained in Section 171 of the CGST Act, 2017. The complainants contended that the respondent builder had failed to pass on the benefit of Input Tax Credit (ITC) allegedly available under the GST regime in respect of a residential housing project.

The complaint was referred to the Director General of Anti-Profiteering (DGAP) for detailed investigation. During the course of the investigation, the DGAP examined the tax structure, availability of input tax credit, turnover, project records, and financial statements relating to the project. The purpose of the investigation was to determine whether the implementation of GST had resulted in any additional ITC benefit to the builder and, if so, whether such benefit had been passed on to the buyers through commensurate reduction in prices.