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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
S.R.KRISHNA KUMAR
Lakshmi Venkateshwara Enterprises – Appellant
Versus
Assistant Commissioner of Central Tax, Bengaluru – Respondent
ORDER :
1. In this petition, petitioner seeks the following reliefs:-
“i) Issue a writ of Certiorari or writ of declaration or any other suitable writ declaring that the action of Respondent No. 1 in blocking the Petitioner's Electronic Credit Ledger (ECL) under Rule 86A of the CGST Rules, 2017 pursuant to reference No. BL2910250000343 as reflected in the Blocked Credit Ledger enclosed as Annexure B is illegal, arbitrary, violative of the principles of natural justice and contrary to Rule 86A; and consequently quash the said blocking order/communications.
ii) Direct Respondent No. 1 to furnish to the Petitioner all material, reports, and documents relied upon while taking action to block the Petitioner's Input Tax Credit, and thereafter afford a reasonable opportunity of hearing to the Petitioner before passing any order in pursuance to Annexure D.
iii) Direct Respondent No.1 to immediately restore the blocked Input Tax Credit of Rs.1,13,89,517/- in the Petitioner's Electronic Credit Ledger forthwith as reflected in the Blocked Credit Ledge enclosed as Annexure B.
iv) Pass any such further order(s) as this Hon'ble Court may deem fit in the interest of justice and equity.”
2. Heard learne
The court emphasized that for blocking an Electronic Credit Ledger under Rule 86A, authorities must base their decision on independent assessment rather than borrowed reasoning, ensuring adherence to....
The court held that blocking a taxpayer's Electronic Credit Ledger requires a valid independent assessment and adherence to natural justice, specifically pre-decisional hearings and recording of reas....
Blocking of Electronic Credit Ledgers requires adherence to procedural fairness and independent justification, as reliance on borrowed satisfaction is impermissible under Rule 86A of the CGST Rules.
The authorities must provide independent reasons and evidence to block a taxpayer's Electronic Credit Ledger under Rule 86A; reliance on borrowed satisfaction is impermissible.
The invocation of Rule 86A to block an Electronic Credit Ledger requires the authorities to fulfill strict preconditions, including providing valid reasons based on independent inquiry, and cannot re....
The court emphasized that blocking an Electronic Credit Ledger under Rule 86A requires independent inquiry and valid reasons to believe that ITC is fraudulently availed, which were not present in thi....
The blocking of Electronic Credit Ledger under Rule 86A must be based on independent analysis and cannot rely solely on borrowed satisfaction; pre-decisional hearing is mandatory.
The blocking of an electronic credit ledger under Rule 86A of the CGST Rules requires independent reasoning and a proper legal basis; actions taken on borrowed satisfaction without pre-decisional hea....
Blocking of an electronic credit ledger under Rule 86A requires independent verification and justifiable reasons, making pre-decisional hearings essential before such actions.
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