W.P.(C) 13665/2026 Page 1 of 25

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* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Judgment reserved on: 17.09.2026

Judgment pronounced on: 28.09.2026

Judgment uploaded on: 28.09.2026

# CNR No. DLHC010443252026

+ W.P.(C) 13665/2026, CM APPLs. 63830/2026 and 63831/2026

LICHFL CARE HOMES LIMITED. .....Petitioner

Through: Mr. Kishore Kunal, Ms.

Runjhun Pare, Advs.

versus

DIRECTOR GENERAL OF ANTI -PROFITEERING,

CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS

& ORS. .....Respondents

Through: Mr. Anurag Ojha, SSC with

Mr. Dipak Raj, Mr. Aryaman

Singh Chouhan, Mr. Aditya

Chaudhary, Advs.

Ms. Sharmila Upadhyay, Ms.

Aditi Anup, Advs. for R-3.

Mr. Niranjan Swain, R-3

through VC.

CORAM:

HON'BLE MR. JUSTICE ANIL KSHETARPAL

HON'BLE MS. JUSTICE SHAIL JAIN

J U D G M E N T

ANIL KSHETARPAL , J.:

1. The present Writ Petition under Articles 226 and 227 of the

Constitution of India has been filed by the Petitioner assailing the

Order dated 23.03.2026 [hereinafter referred to as the „Impugned

Order‟] passed by the Goods and Services Tax Appellate Tribunal,

W.P.(C) 13665/2026 Page 2 of 25

Principal Bench, New Delhi [hereinafter referred to as „GSTAT‟]. By

the Impugned Order, GSTAT has upheld the determination made by

the Directorate General of Anti-Profiteering [hereinafter referred to as

„DGAP‟] under Section 171 of the Central Goods and Services Tax

Act, 2017 [hereinafter referred to as the „CGST Act‟], holding that the

Petitioner had profiteered to the extent of Rs.2,07,08,131/- and, after

adding GST at the rate of 12%, directing payment of an aggregate

amount of Rs.2,31,93,107/- to the homebuyers, together with interest

at the rate of 18%.

2. The controversy arises in the context of the Petitioner‟s

residential project known as “Jeewan Anand” at Bhubaneswar,

Odisha. The proceedings under Section 171 of the CGST Act had

earlier culminated in an order of the erstwhile National Anti-

Profiteering Authority [hereinafter referred to as „NAPA‟] dated

20.06.2022, whereby profiteering of Rs.1,85,70,263/- had been

determined against the Petitioner. The said order was challenged

before this Court in W.P.(C) 12533/2022.

3. During the pendency of the aforesaid proceedings, this Court, in

a batch of petitions including the Petitioner‟s case, rendered its

judgment dated 29.01.2024 in Reckitt Benckiser India Pvt. Ltd. v.

Union of India

1

, wherein the methodology generally adopted by the

anti-profiteering authorities for the real estate sector, based upon

comparison of the ratio of ITC to turnover in the pre-GST and post-

GST periods, was found to be flawed. This Court observed that in the

1

2024 (82) G.S.T.L. 344 (Del.)

W.P.(C) 13665/2026 Page 3 of 25

real estate sector there is no direct correlation between turnover and

ITC availed during a particular period and directed that the total

savings on account of introduction of GST for each project be

calculated and thereafter divided by the total area so as to arrive at the

per square feet benefit to be passed on to the flat buyers.

4. Pursuant to the order dated 25.04.2024 passed in the

Petitioner‟s case, the matter was remanded to the Competition

Commission of India („CCI‟) for fresh determination. The DGAP

thereafter undertook a fresh investigation and submitted its Report

dated 04.04.2025 [hereinafter referred to as the „Impugned DGAP

Report‟]. The said Report forms the basis of the Impugned Order

passed by GSTAT.

5. The principal issue which arises for consideration is whether the

DGAP, while undertaking the exercise pursuant to the aforesaid

remand, adopted a methodology which is contrary to the directions

contained in Reckitt Benckiser (supra), and whether GSTAT

committed an error of law in upholding the determination of

profiteering made on the basis of the said methodology.

FACTUAL MATRIX:

6. In order to appreciate the controversy involved in the present

Writ Petition, the relevant facts are required to be noticed.

7. The Petitioner, LICHFL Care Homes Ltd., undertook

development of a residential project known as “Jeewan Anand” at

Bhubaneswar, Odisha. The project was commenced in the year 2011

W.P.(C) 13665/2026 Page 4 of 25

and was completed in November, 2019. The project comprises

residential flats and covered parking and has a total area of

approximately 2,70,048 square feet as taken into consideration in the

Impugned DGAP Report.

8. The original proceedings under Section 171 of the CGST Act

arose out of a complaint made by a homebuyer alleging that the

benefit of ITC available upon introduction of GST had not been

passed on to the homebuyers by way of commensurate reduction in

prices. The matter was referred to the DGAP, which submitted its first

Report dated 28.01.2021, determining profiteering of Rs.1,85,70,263/-

for the period from July, 2017 to September, 2020. The said Report

was accepted by the erstwhile NAPA vide order dated 20.06.2022.

9. The Petitioner challenged the aforesaid determination before

this Court. The said challenge was considered along with the batch of

petitions culminating in the judgment dated 29.01.2024 in Reckitt

Benckiser (supra). This Court held that no fixed or uniform

mathematical formula could be prescribed for determination of

profiteering and that the methodology had to take into account the

peculiar facts of each case. In relation to the real estate sector, this

Court specifically found that the methodology based upon the

difference between the ratio of ITC to turnover during the pre-GST

and post-GST periods was flawed and directed that the total savings

on account of introduction of GST for each project be calculated and

divided by the total area to arrive at the per square feet benefit.

10. By order dated 25.04.2024 passed in the Petitioner‟s case, the

W.P.(C) 13665/2026 Page 5 of 25

matter was remanded for determination in accordance with the

aforesaid judgment. The Competition Commission of India, vide

communication dated 07.05.2024, consequently directed the DGAP to

reinvestigate the matter.

11. The DGAP issued a notice dated 28.05.2024 seeking

information from the Petitioner in relation to the project. The

Petitioner furnished information and documents vide communications

dated 13.06.2024, 26.07.2024, 06.09.2024, 30.09.2024 and

12.02.2025. The Petitioner, inter alia, furnished details of the year-

wise purchase value of goods and services and the completion status

of the project. The Petitioner maintained that there was no profiteering

and, alternatively, contended that if any benefit on account of ITC on

goods was to be considered, the same could not exceed approximately

Rs.13,49,003/-, which already stands passed on.

12. The DGAP thereafter submitted its report dated 04.04.2025,

pursuant to the aforesaid remand, recalculating the profiteering for the

period from July, 2017 to November, 2019 at Rs.2,31,93,107/-,

including GST.

13. For the purpose of such recalculation, the DGAP considered the

ITC availed during the pre-GST and post-GST periods vis-à-vis the

purchase value of goods and services. The DGAP found that, whereas

the ratio of ITC to the purchase value during the pre-GST period was

NIL, the corresponding ratio during the post-GST period was 17.99%.

On this basis, the increase in ITC attributable to the post-GST period

was taken at 17.99%. Applying the said percentage to the post-GST

W.P.(C) 13665/2026 Page 6 of 25

purchase value of goods and services, excluding taxes and duties, of

Rs.11,54,27,648/-, the DGAP determined the total savings on account

of the additional ITC benefit at Rs.2,07,65,434/-. The aforesaid

amount of Rs.2,07,65,434/- was thereafter apportioned over the total

project area of 2,70,048 square feet, resulting in a saving of Rs.76.895

per square foot. The said figure was applied to the total sold area of

2,69,304 square feet, resulting in a profiteered amount of

Rs.2,07,08,131/-. GST at the effective rate of 12%, amounting to

Rs.24,84,976/-, was thereafter added to the aforesaid amount, resulting

in a total amount of Rs.2,31,93,107/-.

14. The Petitioner contested the Impugned DGAP Report before

GSTAT. It was contended that the entire construction work had been

outsourced to contractors and that, under the pre-GST regime, the

Petitioner was not entitled to ITC on construction materials. It was

further contended that CENVAT credit in respect of service tax paid

on input services was legally available to the Petitioner under the pre-

GST regime, though the same was not actually availed due to an

inadvertent error.

15. The Petitioner placed on record that it had paid service tax of

Rs.1,79,44,457/- during the pre-GST period. It further contended that,

based upon the services procured for construction, CENVAT credit of

approximately Rs.2,38,25,609/- would have been available under the

applicable law, but was not actually availed. The Petitioner

consequently contended that the post-GST ITC on input services

could not be treated as an additional benefit merely because such

W.P.(C) 13665/2026 Page 7 of 25

credit had not been availed during the pre-GST period.

16. The Petitioner also contended that the output tax incidence had

increased after introduction of GST and that the higher ITC arising

from the increased tax incidence could not, in its entirety, be treated as

a benefit under Section 171 of the CGST Act. It was further contended

that the ITC availed on inward goods was only Rs.14,52,570/-

whereas the balance ITC of Rs.1,93,28,564/- related to input services.

17. The DGAP, in its clarification dated 21.11.2025, disputed the

aforesaid submissions. It pointed out that the ST-3 returns filed by the

Petitioner for the relevant pre-GST period reflected NIL CENVAT

credit actually availed. According to the DGAP, the service tax paid

on input services therefore constituted a cost to the Petitioner during

the pre-GST period, whereas, after introduction of GST, the

corresponding GST paid on input services was actually availed as

ITC. The DGAP consequently maintained that the additional ITC

benefit was required to be passed on to the homebuyers.

18. During the proceedings before GSTAT, the Petitioner also

relied upon the alternative computation furnished in its earlier

proceedings, wherein, without prejudice to its principal contention, it

had submitted that if the benefit arising from increased ITC were to be

considered, the profiteering could only be computed at

Rs.1,39,93,358/-. The said submission was predicated, inter alia, upon

the contention that the additional 3% tax incidence on services in the

GST regime could not itself constitute a benefit under Section 171.

W.P.(C) 13665/2026 Page 8 of 25

19. GSTAT, after affording the parties several opportunities of

hearing and written submissions, proceeded to examine the

methodology adopted in the Impugned DGAP Report. GSTAT held

that Reckitt Benckiser (supra) required the total savings on account of

introduction of GST to be calculated for the project and thereafter

divided by the total area so as to determine the per square feet benefit.

20. GSTAT found that the DGAP had considered the entire pre-

GST period up to June, 2017 and the post-GST period from July, 2017

to November, 2019. It noted that the total purchase value of goods and

services was Rs.46,03,72,534/- and that the pre-GST ITC was NIL,

whereas the post-GST ITC availed was Rs.2,07,76,653/-. On this

basis, the post-GST ITC to purchase value ratio was found to be

17.99%.

21. GSTAT further held that the use of the project area and sold

area for determining the benefit was consistent with the direction in

Reckitt Benckiser (supra). It consequently upheld the determination

of Rs.2,07,08,131/- as the profiteered amount and, following the

principle contained in Paragraph No.157 of Reckitt Benckiser,

directed addition of GST at 12%, resulting in an aggregate amount of

Rs.2,31,93,107/-. Interest at the rate of 18% was also directed to be

paid to the homebuyers.

22. Aggrieved by the aforesaid determination, the Petitioner has

approached this Court under Articles 226 and 227 of the Constitution

of India.

W.P.(C) 13665/2026 Page 9 of 25

CONTENTIONS OF THE PARTIES:

23. Heard learned counsel representing the parties and, with their

able assistance, perused the material placed on record.

24. Learned counsel representing the Petitioner has made the

following submissions:

i. The Impugned DGAP Report and the Impugned Order

are contrary to the judgment of this Court in Reckitt Benckiser

(supra). Although this Court had rejected the methodology based

upon comparison of ITC to turnover, the DGAP has merely

substituted “purchase value” for “turnover” and has once again

compared the pre-GST and post-GST ITC ratios.

ii. The direction in Reckitt Benckiser (supra) required

determination of the actual total savings arising on account of

introduction of GST. Mere availability of ITC after introduction

of GST cannot, by itself, establish the quantum of benefit

required to be passed on under Section 171 of the CGST Act.

iii. The Petitioner was legally entitled to CENVAT credit of

service tax paid on input services during the pre-GST period. The

fact that such credit was not actually availed due to an

inadvertent error cannot result in the post-GST ITC on input

services being treated as an additional benefit.

iv. The Petitioner had paid service tax of Rs.1,79,44,457/-

during the pre-GST period and, on the basis of the input services

W.P.(C) 13665/2026 Page 10 of 25

procured, was eligible for CENVAT credit of approximately

Rs.2,38,25,609/-. The Impugned Order erroneously proceeds

solely on the basis of the fact that the Petitioner had not actually

availed such credit.

v. The GSTAT failed to appreciate that the ITC of

Rs.1,93,28,564/- relating to input services was not an incremental

benefit, since corresponding credit was legally available under

the pre-GST regime. At the highest, the ITC of Rs.14,52,570/-

relating to inward goods could have been considered.

vi. The output tax liability also increased after introduction

of GST. The additional ITC arising from the higher rate of tax on

input services could not be treated as an economic benefit

without examining the corresponding increase in tax incidence.

vii. The Petitioner had also incurred substantial expenditure

towards installation of a sub-station and allied electrical

infrastructure and had absorbed expenditure which could

otherwise have been recovered from the homebuyers. The said

circumstance demonstrated that the Petitioner had, in substance,

passed on the benefit and should have been given credit for the

same.

viii. GSTAT further erred in treating the Petitioner‟s earlier

without-prejudice alternative computation of Rs.1,39,93,358/- as

a conclusive admission of profiteering. The said submission was

expressly made without prejudice and was advanced only as an

W.P.(C) 13665/2026 Page 11 of 25

alternative computation assuming that the principal contention of

the Petitioner was not accepted.

25. Per contra, learned counsel representing the Respondents has

supported the Impugned Order and the Impugned DGAP Report. It

has been submitted that:

i. The DGAP has duly acted in accordance with the

directions contained in Reckitt Benckiser (supra), since it has not

adopted the earlier ITC-to-turnover methodology. Instead, it has

determined the additional ITC benefit by reference to the

purchase value and thereafter divided the total saving by the total

project area to arrive at the per square feet benefit.

ii. The record establishes that the Petitioner actually availed

post-GST ITC of Rs.2,07,76,653/-, whereas no CENVAT or

VAT credit was actually availed during the pre-GST period. The

difference represents the additional credit which became

available to the Petitioner upon introduction of GST.

iii. The Petitioner‟s assertion that it was legally entitled to

CENVAT credit in the pre-GST period cannot substitute actual

availment of such credit. The ST-3 returns demonstrate that the

Petitioner had actually availed NIL CENVAT credit.

Consequently, the service tax paid on input services remained a

cost to the Petitioner during the pre-GST period.

iv. The benefit under Section 171 of the CGST Act extends

to ITC on goods as well as services. There is no basis for

W.P.(C) 13665/2026 Page 12 of 25

restricting the benefit to Rs.14,52,570/- merely because that

amount represents the ITC on inward goods.

v. The GSTAT has considered the Petitioner‟s submissions,

including the contention regarding the service tax paid during the

pre-GST period and the a lternative computation of

Rs.1,39,93,358/-. The finding that the Petitioner had made an

admission of profiteering is supported by the Petitioner‟s own

written submissions before the erstwhile NAPA and this Court.

26. No other submissions have been made by the learned counsel

representing the parties.

ANALYSIS AND FINDINGS:

27. The Court has carefully considered the submissions advanced

on behalf of the learned counsel representing the parties and perused

the material placed on record.

28. At the outset, it is necessary to delineate the scope of the

present proceedings. The challenge before this Court is directed

against an order passed by GSTAT after the matter had already

undergone an earlier round of adjudication and had been remanded for

reconsideration in accordance with the judgment of this Court in

Reckitt Benckiser (supra). The present proceedings are, therefore, not

an appeal against the quantum determined by GSTAT. The

jurisdiction under Articles 226 and 227 of the Constitution may

undoubtedly be exercised where the statutory authority or Tribunal has

acted contrary to the governing law, exceeded its jurisdiction or failed

W.P.(C) 13665/2026 Page 13 of 25

to give effect to a binding direction of this Court. However, the

jurisdiction is not intended to substitute the Court‟s own assessment of

factual material for that of the specialised adjudicatory authority.

29. At this stage, it would be apposite to extract the relevant

observations of this Court in Reckitt Benckiser (supra), which govern

the methodology for determination of profiteering in the real estate

sector, for ready reference:

“124. This Court is of the view that no fixed/uniform method or

mathematical formula can be laid down for determining profiteering

as the facts of each case and each industry may be different. The

determination of the profiteered amount has to be computed by taking

into account the relevant and peculiar facts of each case. There is „no

one size that fits all‟ formula or method that can be prescribed in the

present batch of matters. Consequently, NAA has to determine the

appropriate methodology on a case to case basis keeping in view the

peculiar facts and circumstances of each case.

***

129. However, this Court finds that the methodology adopted by NAA

and DGAP to arrive at the profiteering amount of the real estate

industry was generally based on the difference between the ratio of

Input Tax Credit to turnover under the pre-Goods and Services and

Tax and post- Goods and Services and Tax period. This Court is in

agreement with the contention of the learned counsel for the

petitioners representing the real estate companies that the

methodology adopted by NAA is flawed as in the real estate sector,

there is no direct correlation between the turnover and the Input Tax

Credit availed for a particular period. The expenses in a real estate

project are not uniform throughout the life cycle of the project and the

eligibility of credit depends on the nature of the construction activity

undertaken during the particular period. As it is an admitted position

that neither the advances received nor the construction activity is

uniform throughout the life cycle of the project, the accrual of Input

Tax Credit is not related to the amount collected from the buyers. This

Court is in agreement with learned counsel of the petitioners that one

needs to calculate the total savings on account of introduction of

Goods and Services and Tax for each project and then divide the same

by total area to arrive at the per square feet benefit to be passed on to

each flat buyer. This would ensure that flat-buyers with equal square

feet area received equal benefit. The Court, while hearing the present

W.P.(C) 13665/2026 Page 14 of 25

batch of matters on merits, shall take the aforesaid

direction/interpretation into account.

***

157. Both the Central as well as the State Government had no intent of

collecting additional Goods and Services Tax on the higher price as

they had sacrificed their revenue in favour of the buyer. By compelling

the buyers to pay the additional Goods and Services Tax on a higher

price, the supplier has not only defeated the intent of the Governments

but has also acted against the interest of the consumer and therefore,

the Goods and Services Tax collected by him on the additional

realization has rightly been included in the profiteered amount.”

30. The principal contention of the Petitioner is that the remand

pursuant to Reckitt Benckiser (supra) was not properly complied

with. According to the Petitioner, the DGAP has merely replaced the

expression “turnover” with “purchase value” and has thereby

continued to apply the very methodology which this Court had

rejected.

31. The contention, however, proceeds on an incomplete reading of

Paragraph No.129 of Reckitt Benckiser (supra). This Court did not

hold that every comparison between the pre-GST and post-GST period

was impermissible. What was found to be flawed was the

methodology which sought to determine the benefit in the real estate

sector merely by comparing the ratio of ITC to turnover, on the

premise that ITC accrual and turnover move in a corresponding

manner. The reason for rejecting that methodology was that expenses

and construction activity are not uniform throughout the life cycle of a

real estate project and the accrual of ITC is not necessarily related to

the amounts collected from buyers. The Court consequently directed

that the total savings on account of introduction of GST for the project

be determined and divided by the total area.

W.P.(C) 13665/2026 Page 15 of 25

32. In the present case, the DGAP did not apply the earlier ITC-to-

turnover ratio to determine the benefit. The revised exercise was

undertaken by examining the purchase value of goods and services,

determining the ITC actually availed during the post-GST period,

calculating the resultant additional ITC benefit and thereafter dividing

the project-level saving by the total project area. The calculation

ultimately adopted was Rs.2,07,65,434/- as the total saving, Rs.76.895

per square foot as the corresponding project-level saving and

Rs.2,07,08,131/- as the amount relatable to the sold area.

33. The distinction is significant. The purchase value has not been

used as a proxy for turnover for the purpose of determining a benefit

relatable to the amounts realised from individual buyers. It has been

used as the denominator for quantifying the proportion of ITC

available against the project expenditure during the relevant period.

The resulting saving has thereafter been converted into a project-wide

per square foot figure, precisely so that the benefit is distributed with

reference to the area of the flats. This is materially different from the

methodology considered and rejected by this Court in Reckitt

Benckiser (supra).

34. The final step adopted by the DGAP is, in fact, directly aligned

with the direction contained in Paragraph No.129 of Reckitt Benckiser

(supra). The total saving is first determined at the project level and is

thereafter divided by the total area. The benefit relatable to each

recipient is then determined by applying the per square foot figure to

the area sold to that recipient. GSTAT specifically considered this

W.P.(C) 13665/2026 Page 16 of 25

aspect and found that the methodology adopted by the DGAP took

into account the total area and the total sold area for determining the

benefit.

35. It is, therefore, not possible to accept the submission that the

DGAP has simply resurrected the earlier methodology by changing

the denominator from “turnover” to “purchase value”. The exercise

undertaken after remand has a different operative basis. The question

is not whether the methodology is the only possible methodology, but

whether it is a fair and reasonable methodology consistent with the

specific direction issued by this Court. The material placed on record

does not establish that the methodology adopted is contrary to the said

direction.

36. The next and more substantial contention concerns the

treatment of pre-GST CENVAT credit. The Petitioner asserts that

CENVAT credit of approximately Rs.2,38,25,609/- was legally

available in respect of service tax paid on input services, although the

same was not actually availed. The Petitioner consequently submits

that the post-GST ITC on input services cannot be regarded as an

additional benefit.

37. The distinction between eligibility and actual availment is

material in the facts of the present case. The DGAP did not proceed on

the assumption that the Petitioner could never have claimed CENVAT

credit under the pre-GST regime. Its finding was based upon the

actual statutory returns maintained by the Petitioner. As noticed by

GSTAT, the ST-3 returns for the relevant pre-GST period reflected

W.P.(C) 13665/2026 Page 17 of 25

NIL CENVAT credit actually availed. In contrast, the Petitioner

admittedly availed GST ITC of Rs.2,07,76,653/- during the post-GST

period.

38. Section 171 of the CGST Act is concerned with the benefit of

ITC actually accruing to the supplier and its consequential passing on

to the recipient. The question before the authorities was, therefore, not

whether the Petitioner could theoretically have availed a particular

credit had it acted differently during the pre-GST period. The relevant

factual question was whether the Petitioner had, in fact, enjoyed the

benefit of such credit during the pre-GST period. The record

demonstrates that it had not.

39. The Petitioner‟s own affidavit before GSTAT records that,

although it considered itself eligible for CENVAT credit of

Rs.2,38,25,609/-, it had not claimed the same due to an alleged human

error and had paid the service tax in cash. The factual position that

emerges, therefore, is that the credit was not availed and was not

utilised by the Petitioner during the pre-GST period.

40. The consequence is that the Petitioner cannot, for the purposes

of determining the benefit actually available to it upon introduction of

GST, notionally treat an unavailed credit as though it had already

reduced its pre-GST tax incidence. Such an exercise would amount to

comparing actual post-GST benefit with a hypothetical pre-GST

benefit. The anti-profiteering determination, however, has to proceed

on the economic benefit which actually accrued under the respective

tax regimes.

W.P.(C) 13665/2026 Page 18 of 25

41. The submission that the post-GST ITC relating to services must

nevertheless be excluded because CENVAT credit was legally

available under the earlier regime also overlooks the specific factual

finding that the Petitioner had not availed such credit. The DGAP

expressly relied upon the ST-3 returns and treated the service tax paid

on input services as a cost during the pre-GST period. GSTAT

accepted this factual position. There is no material before this Court

demonstrating that the finding regarding NIL actual CENVAT

availment is factually incorrect.

42. The contention that only ITC of Rs.14,52,570/- on inward

goods can constitute the benefit is consequently not sustainable. The

distinction between goods and services is not determinative where the

question is the total additional ITC actually availed by the supplier

after introduction of GST. The material placed before GSTAT

demonstrated that the post-GST ITC comprised Rs.14,52,570/- on

inward goods and Rs.1,93,28,564/- on inward services. GSTAT

considered the contention of the Petitioner but found no basis to

exclude the latter merely because the Petitioner asserted that

CENVAT credit could have been availed under the earlier regime.

43. The contention relating to the increase in the rate of tax also

does not advance the Petitioner‟s case. The Petitioner has relied upon

the fact that the tax incidence on services increased under the GST

regime and submits that the corresponding increase in ITC cannot, by

itself, be treated as a benefit. This submission, however, does not

demonstrate any error in the particular computation undertaken in the

W.P.(C) 13665/2026 Page 19 of 25

present case. The DGAP has not treated the entire post-GST ITC as an

arbitrary windfall. It has quantified the additional ITC against the

purchase value during the post-GST period and thereafter determined

the project-level saving and the per square foot benefit.

44. More importantly, the Petitioner‟s contention regarding the

higher tax incidence was itself considered in the earlier proceedings

and was incorporated in the alternative computation furnished by the

Petitioner. The GSTAT noticed that the Petitioner had, without

prejudice, itself worked out an alternative profiteering figure of

Rs.1,39,93,358/- on the assumption that the increase in ITC

attributable to the higher tax incidence was excluded.

45. The aforesaid alternative computation, however, cannot be

treated as determinative of the actual liability under Section 171. At

the same time, the fact that the Petitioner had furnished such a

computation is relevant to demonstrate that the issue was not ignored

by the adjudicatory authorities. GSTAT examined the alternative

computation and thereafter proceeded to determine the quantum on the

basis of the methodology which it found to be consistent with Reckitt

Benckiser (supra).

46. The Court is also unable to accept the submission that GSTAT‟s

finding regarding admission, by itself, vitiates the Impugned Order. It

is true that a submission expressly made “without prejudice” must be

read in the context in which it was made and cannot mechanically be

treated as an unconditional admission of liability. However, the

Impugned Order does not rest solely upon the alleged admission.

W.P.(C) 13665/2026 Page 20 of 25

GSTAT independently examined the DGAP‟s computation, the

project purchase value, the ITC actually availed, the project area and

the sold area, and thereafter upheld the determination of

Rs.2,07,08,131/-.

47. Thus, even assuming that the Petitioner‟s alternative submission

should not have been described as a conclusive admission, the same

would not undermine the substantive basis upon which the Impugned

Order rests. The determination of profiteering is independently

supported by the computation undertaken by the DGAP and

considered by GSTAT.

48. The Petitioner has further relied upon the expenditure incurred

towards installation of a sub-station and allied electrical infrastructure

and has contended that the said expenditure was ultimately borne by

the Petitioner and was not recovered from the homebuyers. The

Petitioner seeks to rely upon the aforesaid expenditure as a factor

which, according to it, should be taken into consideration while

determining the benefit, if any, required to be passed on.

49. This Court does not consider it necessary to express any view

on the aforesaid aspect in the present proceedings. The question as to

whether such expenditure is liable to be recovered from the

homebuyers or not will depend upon the agreements and other

documents executed into between the parties. If permissible in law,

the Petitioner may avail such remedy in accordance with law. This

Court makes it clear that it has not examined or adjudicated upon the

aforesaid issue. The controversy before this Court is principally

W.P.(C) 13665/2026 Page 21 of 25

confined to the methodology adopted for determination of the benefit

arising on account of additional ITC.

50. It is also relevant that the methodology mandated in Reckitt

Benckiser (supra) does not contemplate a broad balancing of every

commercial expense incurred by a developer against the ITC benefit.

The direction was to determine the total savings arising from

introduction of GST and thereafter distribute that benefit on a per

square foot basis. The exercise cannot be converted into an

unrestricted enquiry into every commercial cost or expenditure of the

project.

51. The central factual position in the present case remains

undisputed: the Petitioner availed NIL CENVAT/VAT credit during

the pre-GST period, whereas it availed GST ITC of Rs.2,07,76,653/-

during the post-GST period. The DGAP then quantified the additional

benefit against the post-GST purchase value and distributed the

resulting project-level saving over the total area. GSTAT has

examined and accepted the said exercise.

52. The Court is conscious that Paragraph No.124 of Reckitt

Benckiser (supra) holds that no fixed or uniform mathematical

formula can be prescribed for determination of profiteering and that

the methodology must take into account the peculiar facts of each

case. This principle, however, does not mean that every methodology

adopted by the authorities is impermissible merely because it involves

a mathematical computation. What is required is that the methodology

be fair, reasonable and responsive to the peculiarities of the particular

W.P.(C) 13665/2026 Page 22 of 25

project.

53. The submission that the authorities were required to determine

some further or different measure of “actual economic benefit”

essentially invites this Court to undertake a fresh factual exercise and

substitute its own computation for that undertaken by the DGAP and

affirmed by GSTAT. Such an exercise would, in the facts of the

present case, amount to exercising appellate jurisdiction over the

findings of GSTAT, which is not the scope of the present proceedings

under Articles 226 and 227 of the Constitution.

54. It is also significant that the Impugned Order was passed after

the Petitioner had been afforded repeated opportunities of hearing.

The GSTAT proceedings commenced on 26.09.2025 and hearings

were thereafter held on several dates, including 13.10.2025,

17.12.2025, 06.01.2026, 29.01.2026, 11.02.2026 and 02.03.2026. The

Petitioner filed written submissions and was specifically directed to

place on record material regarding the rate of service tax applicable

during the pre-GST period. The Petitioner thereafter filed its affidavit

dated 09.02.2026.

55. The grievance of the Petitioner is thus not that it was denied an

opportunity to present its case. On the contrary, the record

demonstrates that its principal submissions regarding the applicability

of Reckitt Benckiser (supra), pre-GST CENVAT credit, the

distinction between goods and services, the increased tax incidence,

the alternative computation and the project expenditure were placed

before GSTAT. The disagreement is with the conclusions reached by

W.P.(C) 13665/2026 Page 23 of 25

GSTAT upon consideration of those submissions.

56. A distinction must be maintained between a case where the

Tribunal fails to consider a material contention altogether and a case

where the contention is considered but rejected. The former may, in an

appropriate case, warrant judicial review. The latter ordinarily does

not, unless the conclusion suffers from a manifest error of law or is

such that no reasonable adjudicatory authority could have arrived at it.

57. The addition of GST at the rate of 12% to the profiteered

amount also does not warrant interference. GSTAT has relied upon

Paragraph No.157 of Reckitt Benckiser (supra), wherein this Court

considered the consequence of GST being collected on the additional

realisation and held that such GST was liable to be included in the

profiteered amount. The Impugned Order has accordingly added

Rs.24,84,976/- to the principal profiteered amount of

Rs.2,07,08,131/-.

58. Likewise, the direction for payment of interest at the rate of

18% follows from the statutory scheme and has been specifically

recorded by GSTAT while directing payment of the amount to the

individual homebuyers. The Petitioner has not demonstrated any

independent jurisdictional infirmity in the said direction.

59. On an overall consideration of the matter, therefore, this Court

finds that the Impugned DGAP Report cannot be said to have ignored

the judgment in Reckitt Benckiser (supra). The methodology adopted

after remand is materially different from the earlier ITC-to-turnover

W.P.(C) 13665/2026 Page 24 of 25

methodology which had been rejected by this Court. The use of

purchase value for quantifying the additional ITC and the subsequent

division of the project-level saving by the total area is not, by itself,

contrary to Paragraph No.129 of the judgment.

60. The further challenge to the treatment of pre-GST CENVAT

credit also cannot be accepted. The Petitioner may have been legally

entitled to claim such credit. However, the authorities were justified in

examining the actual ITC availed during the respective periods rather

than introducing a hypothetical credit into the pre-GST computation.

61. The Court also finds no basis to hold that GSTAT acted beyond

the scope of the remand or failed to consider the material placed

before it. The Impugned Order may not accord with the interpretation

of the Petitioner, but a mere disagreement with the appreciation of the

material or with the methodology adopted, when the methodology is

within the parameters laid down by this Court, does not constitute a

ground for interference under writ jurisdiction.

62. The present case, therefore, does not disclose any patent

jurisdictional error, manifest illegality or failure to comply with the

binding directions issued by this Court in Reckitt Benckiser (supra).

CONCLUSION:

63. In view of the foregoing discussion, this Court is of the

considered view that the Petitioner has failed to establish any ground

warranting interference with the Impugned Order dated 23.03.2026

passed by GSTAT.

W.P.(C) 13665/2026 Page 25 of 25

64. Accordingly, the present Writ Petition, along with the pending

applications, is dismissed.

ANIL KSHETARPAL, J.

SHAIL JAIN, J.

SEPTEMBER 28, 2026

s.godara/shah