Administrative blocking of an electronic credit ledger is subject to a strict one-year limitation period and necessitates adherence to principles of natural justice, specifically the requirement of a pre-decisional hearing, due to the substantial civil consequences such actions impose on a business.

Oral Judgment (Per Aarti Sathe J):-

1. Rule. Rule made returnable forthwith. With the consent of the parties, heard finally.

2. This Petition under Article 226 of the Constitution of India is filed praying for the following substantive reliefs: -

“a) That this Hon'ble Court may be pleased to issue a Writ of Certiorari or Writ in the nature of Certiorari or any other appropriate Writ, Order or Direction calling for records and proceedings dealing with:-

i. the Impugned Provisional Attachment Orders dated 27.02.2025 issued by Respondent No. 2 vide FORM GST DRC 22 of the bank accounts bearing Nos. 40963536902 and 921020036455317 held with Respondent No. 6 and 7 respectively (Exhibit K-K1);

ii. the Impugned Intimation Letter dated 27.02.2025 issued by Respondent No. 3(Exhibit J);

iii. the Impugned Intimation/Communication Letter dated 13.03.2025 and 31.03.2025 issued by the Respondent No. 4 (Exhibit R & U respectively);

and after going into the legality, propriety, and validity thereof, to quash and set aside (i), (ii) & (iii) as mentioned above;

b) That this Hon'ble Court be pleased to issue a Writ of Mandamus or Writ in the nature of Mandamus or any other appropriate Writ, Order or Direction directing Respondents, their servants, subordinates and agents:

i. to defreeze the Petitioner's Bank accounts bearing Nos. 40963536902 and 921020036455317 maintained with Respondent No. 6 and 7 respectively;

ii. to withdraw the Intimation Letter dated 27.02.2025 issued by Respondent No. 3(Exhibit J);

iii. to unblock the Petitioner's ECL vide reference no. BL2703250000079 dated 07.03.2025;

iv. to withdraw the Intimation/Communication Letter dated 13.03.2025 and 31.03.2025 issued by Respondent No. 4 (Exhibit R & U respectively);

c) That pending the hearing and final disposal of the Petition, the Respondents by themselves and their subordinates, servants and agents be directed by an interim order of this Hon'ble Court:

i. to defreeze the Petitioner's Bank accounts bearing Nos. 40963536902 and 921020036455317 maintained with Respondent No. 6 and 7 respectively;

ii. to withdraw the Intimation Letter dated 27.02.2025 issued by Respondent No. 3(Exhibit J);

iii. to unblock the Petitioner's ECL vide reference no. BL2703250000079 dated 07.03.2025;

iv. to withdraw the Intimation/Communication Letter dated 13.03.2025 and 31.03.2025 issued by Respondent No. 4 (Exhibit R & U respectively);”

3. The primary grievance of the Petitioner is to the actions of Respondent Nos. 2 and 3 in provisionally attaching the Petitioner’s bank account under Section 83 of the Maharashtra Goods and Services Tax Act, 2017 (hereinafter referred to as the “MGST Act”) held with Respondent Nos. 6 and 7 vide FORM GST DRC 22 through orders dated 27th February 2025 (hereinafter referred to as the “impugned attachment orders”) as the same suffers from factual discrepancies. The Petitioner is also challenging the illegal blocking of the Petitioner’s Electronic Credit Ledger (ECL), as Respondent No.4 has not assigned any reason before blocking the Input Tax Credit (ITC) available in the ECL, as mandated under Rule 86A of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as the “CGST Rules”) and the guidelines issued by the CBIC (Central Board of Indirect Taxes and Customs) circular nor has Respondent No. 4 given any hearing to the Petitioner before blocking the ITC, in violation of the principles of natural justice.

4. It is the Petitioner’s contention that Rule 86A (3) of the CGST Rules mandates that the ITC which has been blocked in the