The Goods and Services Tax Appellate Tribunal (GSTAT) has set aside the show cause notice issued by the Directorate General of Anti-Profiteering (DGAP) against Puma Realtors Pvt. Ltd., bringing closure to a long-pending anti-profiteering investigation.
The bench of Justice (Retd.) Dr. Sanjaya Kumar Mishra (President) has observed that A successful resolution Applicant cannot suddenly be faced with “undecided” claims after the resolution plan submitted by him has been accepted as this would amount to a hydra head popping up which would throw into uncertainty amounts payable by a prospective resolution Applicant who successfully take over the business of the corporate debtor. All claims must be submitted to and decided by the resolution professional so that a prospective resolution Applicant knows exactly what has to be paid in order that it may then take over and run the business of the corporate debtor.
The case revolved around allegations that Puma Realtors failed to pass on the benefit of Input Tax Credit (ITC) to homebuyers as mandated under Section 171 of the Central GST Act, 2017.
During the hearings, the DGAP informed the Tribunal that Puma Realtors had been declared insolvent, and its assets and liabilities were taken over by M/s One Group Developers Pvt. Ltd. on June 1, 2021, following a resolution plan approved by the National Company Law Tribunal (NCLT).
With the company no longer operational in its original form, the investigation into profiteering remained incomplete due to lack of supporting documents.
To resolve the legal dilemma, the DGAP sought the opinion of Senior Standing Counsel Shri Zoheb Hossain. The counsel clarified that under Section 238 of the Insolvency and Bankruptcy Code (IBC), 2016, IBC provisions override other laws, including GST.
He further relied on key Supreme Court judgments — including Committee of Creditors of Essar Steel India Ltd. vs. Satish Kumar Gupta and Ghanashyam Mishra & Sons Pvt. Ltd. vs. Edelweiss Asset Reconstruction Co. Ltd. — which held that once a resolution plan is approved, all prior claims not included in the plan stand extinguished.
As Puma Realtors’ alleged profiteering claims were not incorporated in the approved resolution plan, they could not be pursued further.
Agreeing with the counsel’s reasoning, the Tribunal ruled that the DGAP’s notice had no legal standing after the insolvency proceedings. The order clearly stated, “The proceeding on Section 171 is hereby closed. The notice issued by the DGAP is hereby set aside.”
Case Details
Case Title: DGAP Versus Puma Realtors Pvt Ltd
Case No.: NAPA/84/PB/2025
Date: 26.08.2025
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