The ruling in brief
For real estate anti-profiteering, project-wise ITC benefit computed through pre- GST and post-GST credit-to-cost ratios with area-wise allocation is valid; benefit must accrue uniformly to all similarly placed buyers and cannot be restricted to receipts from individual purchasers.
Under Section 171, additional post-GST ITC must be passed to each homebuyer by commensurate price reduction and excess benefit to some buyers cannot offset shortfall to others; recipient-wise entitlement governs; DGAP’s project- wise computation of profiteering, inclusive of GST, was justified.
Interest at 18% under Rule 133(3)(b) is mandatory on profiteered amount not passed to recipients, running from date of collection till actual refund or pass-on. Liability is compensatory, independent of intent or delay by authorities, and restores time value of money to buyers.
Section 171(3A), effective from 01-01-2020, creates substantive penal liability and cannot operate retrospectively; hence, no penalty was leviable for profiteering relating to period prior to its enforcement, though profiteered amount with applicable interest remains recoverable